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Measuring Market Integration in the Presence of Threshold Effect: The Case of Bangladesh Rice Markets

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Listed:
  • Alam, Mohammad Jahangir
  • McKenzie, Andrew M.
  • Buysse, Jeroen
  • Begum, Ismat Ara
  • Wailes, Eric J.
  • Van Huylenbroeck, Guido

Abstract

Spatial price integration among five major Bangladesh rice markets is examined in the presence of threshold effects to account for the impact of transaction costs in the price adjustment process. Hansen and Seo (2002) threshold cointegration tests and threshold vector error correction models confirm the presence of threshold effects. Results highlight the importance of directing policy goals towards reducing transaction cost to engender greater pricing efficiency in Bangladesh rice markets.

Suggested Citation

  • Alam, Mohammad Jahangir & McKenzie, Andrew M. & Buysse, Jeroen & Begum, Ismat Ara & Wailes, Eric J. & Van Huylenbroeck, Guido, 2012. "Measuring Market Integration in the Presence of Threshold Effect: The Case of Bangladesh Rice Markets," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124435, Agricultural and Applied Economics Association.
    • Handle: RePEc:ags:aaea12:124435
    DOI: 10.22004/ag.econ.124435
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    Cited by:

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    3. Shrestha, Rudra Bahadur & Huang, Wen-Chi & Ghimire, Raju, 2014. "Market Price Cointegration Of Tomato: Effects To Nepalese Farmers," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 2(2), pages 1-10, April.
    4. Valdes, Rodrigo & Von Cramon-Taubadel, Stephan & Engler, Alejandra, 2015. "Transaction costs and trade liberalization: An empirical perspective from the MERCOSUR agreement," Food Policy, Elsevier, vol. 55(C), pages 109-116.

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