IDEAS home Printed from https://ideas.repec.org/p/ags/saeatm/35139.html
   My bibliography  Save this paper

Mandatory Versus Voluntary Price Reporting: An Empirical Investigation Of The Market Transparency Controversy

Author

Listed:
  • Fausti, Scott W.
  • Keimig, R.
  • Diersen, Matthew A.
  • Kim, Han
  • Santos, Joseph M.

Abstract

The ability of the former voluntary price reporting system to generate market transparency in U.S. livestock markets was called into question by producer groups and academic research prior to the new federal system of mandatory price reporting being implemented. The market transparency issue is investigated by comparing price data collected from the former AMS voluntary price reporting system to mandatory price reporting data for live slaughter steers collected by the State of South Dakota before the advent of the new federal system. The relationship between a set of public price report series and the South Dakota mandatory price series is analyzed using cointegration techniques. The empirical findings indicate a strong long-run and short-run integrated relationship between the mandatory price series and a majority of the selected public price reports. We conclude that in the cash market for live steers in South Dakota, the former voluntary price reporting system did foster market transparency and aided in the price discovery process.

Suggested Citation

  • Fausti, Scott W. & Keimig, R. & Diersen, Matthew A. & Kim, Han & Santos, Joseph M., 2003. "Mandatory Versus Voluntary Price Reporting: An Empirical Investigation Of The Market Transparency Controversy," 2003 Annual Meeting, February 1-5, 2003, Mobile, Alabama 35139, Southern Agricultural Economics Association.
    • Handle: RePEc:ags:saeatm:35139
    DOI: 10.22004/ag.econ.35139
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/35139/files/sp03fa02.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.35139?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cheryl J. Wachenheim & Eric A. DeVuyst, 2001. "Strategic response to mandatory reporting legislation in the U.S. livestock and meat industries: Are collusive opportunities enhanced?," Agribusiness, John Wiley & Sons, Ltd., vol. 17(2), pages 177-195.
    2. William G. Tomek, 1980. "Price Behavior on a Declining Terminal Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 62(3), pages 434-444.
    3. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 39(3), pages 106-135.
    4. Lawrence, John D. & Shafer, John & Hayenga, Marvin L., 1996. "Valuing Public Price Reporting: The Iowa Experience," Staff General Research Papers Archive 5148, Iowa State University, Department of Economics.
    5. Diersen, Matthew A., 2002. "Gleaning Information From Mandatory Livestock Price Reporting," Economics Staff Papers 32017, South Dakota State University, Department of Economics.
    6. Barry K. Goodwin & Ted C. Schroeder, 1991. "Cointegration Tests and Spatial Price Linkages in Regional Cattle Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(2), pages 452-464.
    7. Pier Giorgio Ardeni, 1989. "Does the Law of One Price Really Hold for Commodity Prices?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 71(3), pages 661-669.
    8. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    9. Hayenga, Marvin L. & Koontz, Stephen R. & Schroeder, Ted C., 1996. "Definition of Regional Cattle Procurement Markets," Staff General Research Papers Archive 10562, Iowa State University, Department of Economics.
    10. Savin, N Eugene & White, Kenneth J, 1978. "Testing for Autocorrelation with Missing Observations," Econometrica, Econometric Society, vol. 46(1), pages 59-67, January.
    11. Bastian, Christopher T. & Koontz, Stephen R. & Menkhaus, Dale J., 2001. "Will Mandatory Price Reporting Improve Pricing And Production Efficiency In An Experimental Market For Fed Cattle?," 2001 Conference, April 23-24, 2001, St. Louis, Missouri 18969, NCR-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management.
    12. Granger, C. W. J., 1981. "Some properties of time series data and their use in econometric model specification," Journal of Econometrics, Elsevier, vol. 16(1), pages 121-130, May.
    13. Lawrence, John D. & Shaffer, John A. & Hayenga, Marvin L., 1996. "Valuing Public Price Reporting: The Iowa Experience," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 14(1), pages 1-18.
    14. Anderson, John D. & Ward, Clement E. & Koontz, Stephen R. & Peel, Derrell S. & Trapp, James N., 1998. "Experimental Simulation Of Public Information Impacts On Price Discovery And Marketing Efficiency In The Fed Cattle Market," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(1), pages 1-17, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sarah Grunewald & Ted C. Schroeder & Clement E. Ward, 2004. "Cattle Feeder Perceptions of Livestock Mandatory Price Reporting," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 26(4), pages 521-538.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fausti, Scott W. & Diersen, Matthew A., 2003. "Did The Voluntary Price Reporting System Fail To Provide Price Transparency In The Cash Market For Dressed Steers: Evidence From South Dakota," Economics Staff Papers 32012, South Dakota State University, Department of Economics.
    2. Fausti, Scott W. & Diersen, Matthew A., 2003. "Did The Voluntary Price Reporting System Fail To Provide Price Transparency In The Cash Market For Dressed Steers: Evidence From South Dakota," Economics Staff Papers 32012, South Dakota State University, Department of Economics.
    3. Fausti, Scott W. & Diersen, Matthew A., 2005. "Price Transparency in the Voluntary Price Reporting System for Live Cattle: Theory and Empirical Evidence from South Dakota," Economics Staff Papers 32027, South Dakota State University, Department of Economics.
    4. Fausti, Scott W. & Diersen, Matthew A., 2004. "The Voluntary Reporting System's Ability to Provide Price Transparency in the Cash Market for Dressed Steers: Evidence from South Dakota," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 29(3), pages 1-14, December.
    5. Fausti, Scott W. & Diersen, Matthew A., 2005. "Price Transparency in the Voluntary Price Reporting System for Live Cattle: Theory and Empirical Evidence from South Dakota," Economics Staff Papers 32027, South Dakota State University, Department of Economics.
    6. Fausti, Scott W. & Diersen, Matthew A. & Sun, He, 2003. "Discontinued Voluntary Price Reports For Live Cattle: Will They Be Missed By Producers?," Economics Staff Papers 32019, South Dakota State University, Department of Economics.
    7. Param Silvapulle & Sisira Jayasuriya, 1994. "Testing For Philippines Rice Market Integration: A Multiple Cointegration Approach," Journal of Agricultural Economics, Wiley Blackwell, vol. 45(3), pages 369-380, September.
    8. Fausti, Scott W. & Diersen, Matthew A. & Qasmi, Bashir A., 2007. "Public Price Reporting in the Cash Market for Live Cattle: A Spatial Market Approach," Agricultural and Resource Economics Review, Cambridge University Press, vol. 36(2), pages 336-348, October.
    9. Bingham, Matthew F. & Prestemon, Jeffrey P. & MacNair, Douglas J. & Abt, Robert C. & Bingham, Matthew F., 2003. "Market structure in U. S. southern pine roundwood," Journal of Forest Economics, Elsevier, vol. 9(2), pages 97-117.
    10. Frank Asche & Daniel Gordon & Rognvaldur Hannesson, 2002. "Searching for price parity in the European whitefish market," Applied Economics, Taylor & Francis Journals, vol. 34(8), pages 1017-1024.
    11. Maurice J. Roche & Kieran McQuinn, 2003. "Grain price volatility in a small open economy," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 30(1), pages 77-98, March.
    12. Fausti, Scott W. & Qasmi, Bashir A. & Landblom, Douglas G. & Beutler, Martin & Johnson, Patricia S. & Gates, Roger N. & Patterson, Hubert H. & Salverson, Robin R., 2007. "Public Price Reporting, Marketing Channel Selection, and Price Discovery: The Perspective of Cow/Calf Producers in the Dakotas," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 25(1), pages 1-18.
    13. Florine Livat, 2007. "Mesure des interactions de prix : une analyse des modalités de substitution parmi sept vins de Bordeaux," Économie et Prévision, Programme National Persée, vol. 180(4), pages 127-145.
    14. D. Hallam & F. Machado & G. Rapsomanikis, 1992. "Co‐Integration Analysis And The Determinants Of Land Prices," Journal of Agricultural Economics, Wiley Blackwell, vol. 43(1), pages 28-37, January.
    15. Liang, Chyi-Lyi (Kathleen) & Feuz, Dillon M. & Taylor, R. Garth, 1998. "Spatial And Varietal Price Analysis Of Dry Edible Bean Markets," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 1(3), pages 1-17.
    16. Liang, Chyi-Lyi (Kathleen) & Feuz, Dillon M. & Taylor, R. Garth, 1997. "Cointegration Tests of Spatial and Variety Price Linkages in Regional Dry Bean Markets," 1997 Annual Meeting, July 13-16, 1997, Reno\ Sparks, Nevada 35787, Western Agricultural Economics Association.
    17. Patrick L. Hatzenbuehler & Philip C. Abbott & Tahirou Abdoulaye, 2017. "Price Transmission in Nigerian Food Security Crop Markets," Journal of Agricultural Economics, Wiley Blackwell, vol. 68(1), pages 143-163, February.
    18. G. P. Zanias, 1993. "Testing For Integration In European Community Agricultural Product Markets," Journal of Agricultural Economics, Wiley Blackwell, vol. 44(3), pages 418-427, September.
    19. Fredj Jawadi & Catherine Bruneau & Nadia Sghaier, 2009. "Nonlinear Cointegration Relationships Between Non‐Life Insurance Premiums and Financial Markets," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 76(3), pages 753-783, September.
    20. Sahito, Jam Ghulam Murtaza, 2015. "Market integration of wheat in Pakistan," Discussion Papers 72, Justus Liebig University Giessen, Center for international Development and Environmental Research (ZEU).

    More about this item

    Keywords

    Marketing;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:saeatm:35139. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/saeaaea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.