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Factor and Product Market Tradability and Equilibrium in Pacific Rim Pork Industries

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  • Barrett, Christopher B.
  • Li, Jau-Rong
  • Bailey, DeeVon

Abstract

This paper uses a new market analysis methodology to examine price and trade relationships in eight Pacific Rim factor and product markets central to the Canadian and U.S. pork industries. The new method enables direct estimation of the frequency with which a variety of market conditions occur, including competitive equilibrium, tradability, and segmented equilibrium. While extraordinary profit opportunities emerge episodically in a few niche markets, the vast majority of the markets studied are highly competitive -exhibiting zero marginal profits to spatial arbitrage at monthly frequency -and internationally contestable. In spite of continued high international transfer costs, the Pacific Rim is effectively a single market for pork producers and processors today.

Suggested Citation

  • Barrett, Christopher B. & Li, Jau-Rong & Bailey, DeeVon, 1999. "Factor and Product Market Tradability and Equilibrium in Pacific Rim Pork Industries," Working Papers 127696, Cornell University, Department of Applied Economics and Management.
  • Handle: RePEc:ags:cudawp:127696
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    File URL: http://ageconsearch.umn.edu/record/127696/files/Cornell_Dyson_wp9923.pdf
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    References listed on IDEAS

    as
    1. Dawn D. Thilmany & Christopher B. Barrett, 1997. "Regulatory Barriers in an Integrating World Food Market," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 19(1), pages 91-107.
    2. Pinelopi Koujianou Goldberg & Michael M. Knetter, 1997. "Goods Prices and Exchange Rates: What Have We Learned?," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1243-1272, September.
    3. McNew, Kevin & Fackler, Paul L., 1997. "Testing Market Equilibrium: Is Cointegration Informative?," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 22(02), December.
    4. Li, Jau-Rong & Barrett, Christopher B., 1999. "Distinguishing Between Equilibrium And Integration In Markets Analysis," Working Papers 14607, International Agricultural Trade Research Consortium.
    5. Bob Baulch, 1997. "Transfer Costs, Spatial Arbitrage, and Testing for Food Market Integration," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 477-487.
    6. Richard J. Sexton & Catherine L. Kling & Hoy F. Carman, 1991. "Market Integration, Efficiency of Arbitrage, and Imperfect Competition: Methodology and Application to U.S. Celery," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(3), pages 568-580.
    7. Christopher B. Barrett, 1996. "Market Analysis Methods: Are Our Enriched Toolkits Well Suited to Enlivened Markets?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(3), pages 825-829.
    8. Roger A. Dahlgran & Steven C. Blank, 1992. "Evaluating the Integration of Contiguous Discontinuous Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 74(2), pages 469-479.
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    Cited by:

    1. Negassa, Asfaw & Myers, Robert & Gabre-Madhin, Eleni Z., 2004. "Grain marketing policy changes and spatial efficiency of maize and wheat markets in Ethiopia," MTID discussion papers 66, International Food Policy Research Institute (IFPRI).
    2. Dragan Miljkovic, 2009. "US and Canadian livestock prices: market integration and trade dependence," Applied Economics, Taylor & Francis Journals, vol. 41(2), pages 183-193.
    3. Liddell, Sterling & Bailey, DeeVon, 2001. "Market Opportunities And Threats To The U.S. Pork Industry Posed By Traceability Systems," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 4(03).
    4. Mutambatsere, Emelly & Mabaya, Edward T. & Christy, Ralph D., 2006. "Integration and Equilibrium of Maize Markets in Southern Africa: A SADC Sub-regional Assessment," Working Papers 127056, Cornell University, Department of Applied Economics and Management.
    5. Liu, Lan & Yue, Chengyan, 2009. "Non-tariff Barriers to Trade Caused by SPS Measures and Customs Procedures with Product Quality Changes," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 34(1), April.
    6. Padilla-Bernal, Luz E. & Thilmany, Dawn D. & Loureiro, Maria L., 2003. "An Empirical Analysis of Market Integration and Efficiency for U.S. Fresh Tomato Markets," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 28(03), December.
    7. Padilla-Bernal, Luz E. & Thilmany, Dawn D. & Loureiro, Maria L., 2001. "Tradability And Market Equilibrium For U.S.-Mexico Fresh Tomatoes," 2001 Annual Meeting, July 8-11, 2001, Logan, Utah 36142, Western Agricultural Economics Association.
    8. Hache, E. & Massol, O., 2016. "Sanctions against Iran: An assessment of their global impact through the lens of international methanol prices," Working Papers 14973, Department of Economics, City University London.

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    Keywords

    Livestock Production/Industries; Marketing;

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