IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this paper

Grain Transport on the Mississippi River and Spatial Corn Basis

Listed author(s):
  • Li, Shu
  • Thurman, Walter N.

This paper analyzes the effects of waterway transportation costs on the spatial distribution of corn prices at U.S. grain markets. Interregional trade theory predicts that in a competitive market price differences between markets are explained by transportation cost. The precise role played by transportation costs can depend on distances that grain needs to travel and also on the extent to which markets are integrated into the transportation system. The Mississippi waterway consists of an efficient barge transportation system that links the Midwest to the largest grain export market, the Gulf of Mexico. In markets with export to the Gulf, we predict that: (1) the magnitude of price differences between two markets increases with an exogenous increase in barge rates; (2) the response of prices to barge rate changes for markets on the river is greater the farther north, or upstream, the market is; (3) the magnitude of the barge-rate effect on prices declines with distance from the market to the river; (4) the barge-rate effect is less pronounced in markets that are less integrated into the river system. We develop theory-based predictions along these lines. We test the predictions and measure the associated effects with a mixture of parametric and nonparametric methods applied to a rich panel data set of corn prices from over one thousand locations.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by Southern Agricultural Economics Association in its series 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida with number 143054.

in new window

Date of creation: 2013
Handle: RePEc:ags:saea13:143054
Contact details of provider: Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:ags:saea13:143054. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.