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Tradability And Market Equilibrium For U.S.-Mexico Fresh Tomatoes

  • Padilla-Bernal, Luz E.
  • Thilmany, Dawn D.
  • Loureiro, Maria L.

Tomato trade between the U.S. and Mexico has grown significantly during the past decade. This increased trade, together with major structural changes in US produce marketing channels, has increased the complexity of conducting analysis of market integration and equilibrium. This study implements an Extended Parity Bounds Model (EPBM), following the work of Barrett and Li, to examine fresh tomato trade relationships between major shipping points and terminal markets for Mexican imported and Florida and California tomatoes. Findings suggest that, although markets seem relatively integrated and efficient, there exist some potential for claims of inefficient or overly competitive behavior. As is expected, the more complex the marketing channels between producer and wholesaler (distance or international boundaries), the more likely that markets operate suboptimally.

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File URL: http://purl.umn.edu/36142
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Paper provided by Western Agricultural Economics Association in its series 2001 Annual Meeting, July 8-11, 2001, Logan, Utah with number 36142.

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Date of creation: 2001
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Handle: RePEc:ags:waealo:36142
Contact details of provider: Web page: http://waeaonline.org/

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  1. 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.
  2. Gary D. Thompson & Paul N. Wilson, 1997. "The organizational structure of the North American fresh tomato market: Implications for seasonal trade disputes," Agribusiness, John Wiley & Sons, Ltd., vol. 13(5), pages 533-547.
  3. Officer, Lawrence H., 1986. "The law of one price cannot be rejected: Two tests based on the tradable/nontradable price ratio," Journal of Macroeconomics, Elsevier, vol. 8(2), pages 159-182.
  4. 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.
  5. Spiller, Pablo T & Huang, Cliff J, 1986. "On the Extent of the Market: Wholesale Gasoline in the Northeastern United States," Journal of Industrial Economics, Wiley Blackwell, vol. 35(2), pages 131-45, December.
  6. Spiller, Pablo T. & Wood, Robert O., 1988. "The estimation of transaction costs in arbitrage models," Journal of Econometrics, Elsevier, vol. 39(3), pages 309-326, November.
  7. Calvin, Linda & Cook, Roberta L. & Denbaly, Mark & Dimitri, Carolyn & Glaser, Lewrene K. & Handy, Charles R. & Jekanowski, Mark D. & Kaufman, Phillip R. & Krissoff, Barry & Thompson, Gary D. & Thornsb, 2001. "U.S. Fresh Fruit and Vegetable Marketing: Emerging Trade Practices, Trends, and Issues," Agricultural Economics Reports 33915, United States Department of Agriculture, Economic Research Service.
  8. Kaufman, Phillip R. & Handy, Charles R. & McLaughlin, Edward W. & Park, Kristen & Green, Geoffrey M., 2000. "Understanding The Dynamics Of Produce Markets: Consumption And Consolidation Grow," Agricultural Information Bulletins 33747, United States Department of Agriculture, Economic Research Service.
  9. Padilla-Bernal, Luz E. & Thilmany, Dawn D., 2000. "Mexican-U.S. Fresh Tomato Trade: An Analysis Of Volume, Prices And Transaction Costs," 2000 Annual Meeting, June 29-July 1, 2000, Vancouver, British Columbia 36445, Western Agricultural Economics Association.
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