Wholesale Milk Markets: A Study of Market Integration in Indian Markets
Market integration is an important determinant of responsiveness and behavior of the markets needed to formulate price policies. Indian wholesale milk markets are correlated with varying degrees of integration. Paper uses monthly wholesale prices of milk for the period from April 1997 to December 2009 for 5 major market centres viz. Chennai, Delhi, Kolkata, Mumbai, and Kanpur. Prices were converted into real prices by deflating with wholesale price index of all commodities. Extent of integration among different markets is tested using method and procedure for testing co-integration suggested by Johansen (1991, 1995), and Johansen and Juselius (1990) and Engle and Granger (1987). Results reveal that milk markets of Kolkata and Mumbai are critical to sustaining long-run equilibrium which had strong bearings on the prices of other three markets viz, Delhi, Kanpur and Chennai. The speed of error correction for Kolkata and Mumbai markets are relatively faster than that of others and Kolkata and Mumbai markets can reinstate the long-run equilibrium quickly if appropriate error correction measures are taken.
|Date of creation:||15 May 2013|
|Date of revision:||19 Jun 2013|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- 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.
- Kling, Catherine L. & Sexton, Richard & Carman, Hoy, 1991. "Market Integration, Efficiency of Arbitrage, and Imperfect Competition: Methodology and Application to U.S. Celery," Staff General Research Papers 1609, Iowa State University, Department of Economics.
- Engle, Robert & Granger, Clive, 2015.
"Co-integration and error correction: Representation, estimation, and testing,"
Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
- Arvind Virmani & Surabhi Mittal, 2006. "Domestic Market Integration," Macroeconomics Working Papers 22271, East Asian Bureau of Economic Research.
- Johansen, Soren, 1995. "Likelihood-Based Inference in Cointegrated Vector Autoregressive Models," OUP Catalogue, Oxford University Press, number 9780198774501, July.
- Stigler, George J & Sherwin, Robert A, 1985. "The Extent of the Market," Journal of Law and Economics, University of Chicago Press, vol. 28(3), pages 555-85, October.
- Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-80, November.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:47721. 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: (Joachim Winter)
If references are entirely missing, you can add them using this form.