asymmetry in retail wholesale and shipping point pricing for fresh vegetables the linkage among retail wholesale and shipping point prices for a select group of fresh vegetables is measured using wolffram s asymmetry model procedures for dealing with discontinuous time series are shown and granger s causality test is used to show the direction of the price linkage wholesale prices are shown to lead both retail and shipping point prices asymmetry in the retail wholesale response indicates that wholesale price decreases are reflected at the retail more so than are wholesale price increases wholesale price decreases are more fully passed through to the shipping point relative to wholesale increases

price dynamics in a vertical sector the case of butter we develop a reduced form model of price transmission in a vertical sector allowing for refined asymmetric contemporaneous and lagged own and cross price effects under time varying volatility the model is used to investigate the wholesale retail price dynamics in the u s butter market the analysis documents the nature of nonlinear price dynamics in a vertical sector it finds strong evidence of asymmetric retail price responses both in the short term and the longer term but only weak evidence of asymmetric wholesale price responses asymmetric retail responses play a major role in generating a skewed distribution of butter prices the empirical results indicate the presence of imperfect competition at the retail level

price cycles and asymmetric price transmission in the u s pork market economists have proposed several plausible explanations for observed price transmission asymmetries in commodity markets unfortunately the econometric methods commonly used in such studies cannot empirically distinguish pricing behavior under the competing theories we argue that the theories may be classified by firm responses to high and low frequency price cycles and use engle s band spectrum regression to test the symmetry of high and low frequency cycles in weekly pork prices the findings indicate that changes in wholesale prices are asymmetrically transmitted to retail prices in relatively low frequency cycles which does not support search costs and other high frequency explanations conversely wholesale pork prices asymmetrically adjust to changes in farm prices at all frequencies copyright 2001 oxford university press

asymmetry and rigidity in farm retail price transmission this article demonstrates how retail price transmission asymmetry can arise from intertemporal optimizing behavior among spatially competitive retailers facing concave spatial demand and shows that vigorous competition among retailers may not necessarily result in the larger retail price declines farmers expect during periods of declining farm prices it also shows that when this particular class of retailers incurs repricing costs retail prices can be rigid over a range of upward and downward movements in the farm price this suggests that the rigidity of retail prices during periods of declining farm prices could be due to repricing costs it also suggests that the appropriate econometric model of price transmission is the model of friction where tobit analysis is the proper method of estimation rather than nonreversible functions

cointegration and market integration an application to the indonesian rice market this article suggests improvements in the use of regression analysis to measure spatial market integration the procedure pioneered by ravallion is still widespread but is valid only under certain conditions of exogeneity the alternative offered here is an error correction mechanism which makes it possible to test for exogeneity as well as indicating the direction and strength of causality in price formation between markets the method is illustrated with data on rice prices in different parts of the indonesian market the results confirm among other things that supply sources are more important than demand sources in driving prices

prices rise faster than they fall output prices tend to respond faster to input increases than to decreases this tendency is found in more than two of every three markets examined it is found as frequently in producer goods markets as in consumer goods markets in both kinds of markets the asymmetric response to cost shocks is substantial and durable on average the immediate response to a positive cost shock is at least twice the response to a negative shock and that difference is sustained for at least five to eight months unlike past studies which documented similar asymmetries in selected markets gasoline agricultural products etc this one uses large samples of diverse products 77 consumer and 165 producer goods accordingly the results suggest a gap in an essential part of economic theory as a start on filling this gap the study finds no asymmetry in the resonse of an individual decision maker a supermarket chain to its costs but it finds above average asymmetry where a cost shock is filtered through a fragmented w

asymmetry in farm retail price transmission for major dairy products an econometric model is used to estimate the net relationship between changes in the farm level price of milk and changes in the retail prices of four major dairy products fluid milk butter cheese and ice cream results indicate that the farm retail price transmission process in the dairy sector is asymmetric retail dairy product prices adjust more rapidly and more fully to increases in the farm price of milk than to decreases the role in pricing asymmetry of retail demand versus farm supply shifts is tested via a chow type test asymmetry is tested using the houck procedure for estimating nonreversible functions

rice in asia is it becoming an inferior good empirical results using time series and cross sectional data indicate that rice in asia is becoming an inferior good income elasticities declined and in some cases became negative between 1961 and 1985 in most of the fourteen asian countries studied accordingly domestic demand for rice in these countries is not likely to grow as rapidly as it has in the past as a consequence there is a potential for excess supplies of rice to develop in asia putting downward pressure on rice prices while governments in asian countries may need to adjust their rice policies in the future world rice suppliers may need to develop new markets for rice

does asymmetry in price transmission exist in the rice market in sri lanka abstractthis study analyses asymmetry in price transmission between wholesale and retail rice markets in sri lanka using the threshold autoregressive model we found that the wholesale and the retail rice markets in sri lanka are integrated with price changes moving from the wholesale to the retail market however the price transmission process is asymmetric in particular price increases at the wholesale market transmit immediately to the retail market while price decreases transmit more slowly parameter stability test and follow up analysis indicated that the price transmission process is asymmetric only during periods of price surges suggesting that the rice market is not efficient during these periods

nonlinear adjustments in deviations from the law of one price for wholesale hog prices this article applies the band threshold autoregression band tar model to investigate whether the law of one price loop holds in taiwanese wholesale hog markets during the period from may 1987 through december 2003 we find evidence of a nonlinear mean reversion in deviations from the loop for relative hog prices our empirical study confirms the presence of thresholds and provides strong evidence in support of the view that the regional hog markets have been tightly integrated in taiwan and that the wholesale hog market in taiwan is an efficient market economy furthermore the estimated half lives from the nonlinear generalized impulse response analysis are as short as four months

price transmission and asymmetric adjustment in the u s beef sector the u s livestock sector has experienced numerous structural changes in recent years for example the meatpacking industry has experienced many mergers and acquisitions leading to significant increases in industry concentration in particular the four firm concentration ratio for steer and heifer slaughter a frequently cited statistic and an important indicator of industry concentration increased from 35 7 in 1980 to 79 8 in 1997 usda there have also been significant regional shifts in livestock production and changes in marketing practices with decreased use of public markets in many areas for some products traditional auction markets have been largely replaced by contract production and sales cattle inventories have also trended downward over the last two decades this has been accompanied by decreases in the number of producers and in some cases with significant increases in the scale of operations the vertical transmission of shocks among various levels of the market is an important characteristic describing the overall operation of the market of course price is the primary mechanism by which various levels of the market are linked the extent of adjustment and speed with which shocks are transmitted among producer wholesale and retail market prices is an important factor reflecting the actions of market participants at alternative market levels the nature speed and extent of adjustments to market shocks may also have important implications for marketing margins spreads and mark up pricing practices an extensive literature has examined mar

asymmetry in beef lamb and pork farm retail price transmission in australia abstract the hypothesis of asymmetry in price transmission within the australian meat market is tested using monthly data for beef lamb and pork prices at different market levels over the period 1971 1988 the results indicate that asymmetrical price response is a strategy used by beef and lamb retailers and wholesalers to adjust to changing input prices but not by pork retailers and wholesalers this difference is perhaps unexpected given the similarity in behaviours relating to price levelling in this market the high cross price elasticities of demand between these meats and the relatively greater degree of concentration in the pork market

austrian and swedish social democrats in crisis party strategy and organization in corporatist regimes socialists and social democrats have probably nowhere been better entrenched than in austria and sweden yet in both countries they have suffered electoral defeats in the 1980s and early 1990s ju

spatial price transmission and asymmetry in the ghanaian maize market abstract this paper utilizes recently developed threshold cointegration tests that allow for asymmetric adjustment toward a long run equilibrium relationship to examine price linkages between principal maize markets in ghana unlike previous studies the approach employed here assumes that economic agents only act to move the system back to equilibrium when the deviation from equilibrium exceeds a critical threshold whereby the benefits of this adjustment exceed the costs the findings indicate that major maize markets in ghana are well integrated both the threshold cointegration and asymmetric error correction models reveal that wholesale maize prices in local markets accra and bolgatanga respond more swiftly to increases than to decreases in central market techiman prices accra prices are found to react faster than bolgatanga prices to changes in techiman market prices

optimal investment plan for dynamic thermal rating using benders decomposition abstract the dynamic thermal rating is a new technology that utilizes the capacity of power transmission lines based on the ambient factors and the line condition it usually offers higher thermal capacity than the traditional static rating we propose a multi stage mixed integer programming model and find the optimal investment plan for the dynamic ratings using benders decomposition the investment plan includes when and which line should be upgraded to dynamic rating and which line should be switched out of service the problem is decomposed into a master problem and three sub problems the master problem explores the candidate lines for both the investment plan and the switching plan throughout the planning horizon the sub problems evaluate the proposed plans in terms of unmet demand and generation cost generation and transmission contingencies are also included in the model we use our model on garver s system and ieee 118 bus power systems to demonstrate our solution approach we conduct sensitivity analyses and study the uncertainty in real time thermal ratings loads and the discounting rate our studies show that the utilization of the dynamic ratings and the practice of transmission switching are complementary and can reduce the cost on the 118 bus system up to 30 percent

using threshold cointegration to estimate asymmetric price transmission in the swiss pork market this paper employs threshold cointegration tests that allow for asymmetric adjustment towards a long run equilibrium relationship to examine the relationship between producer and retail pork prices in switzerland the short run adjustments are also examined with asymmetric error correction models that are compared to the conventional symmetric error correction models the results indicate that price transmission between the producer and retail levels is asymmetric in the sense that increases in producer prices that lead to declines in marketing margins are passed on more quickly to retail prices than decreases in producer prices that result in increases in the marketing margins

rice market integration and food security in nepal the role of cross border trade with india coarse rice market integration between nepal and india is analyzed applying a threshold autoregressive model the price response behaviour of traders is found to be consistent with an asymmetric price adjustment mechanism indicating coarse rice prices in nepal respond to shocks originating in india the results show that adjustments to negative price deviations from long run stable equilibrium are faster than adjustments to the positive ones given a null threshold given that trade flows mainly from india to nepal nepali traders would adjust their prices upward to align with the long run equilibrium value relatively more quickly in the case of negative price deviations than if the price deviations were positive such a high speed of adjustment to negative price deviations could be detrimental to net food buyers food security status in the absence of a price stabilization mechanism however a price stabilization policy in nepal a food deficit and import dependent country would hardly have any effect on prices unless further effort is made to build up the level of national food reserves for short term food security interventions in the current context of structurally low levels of national food reserves an alternative short term policy such as foreign aid in the form of food or income transfers targeting the most vulnerable households to price increases is necessary through social safety net programmes in the long run an improvement of transportation infrastructure between market hubs other than the biratnagar trade basin in the terai nepal and india would contribute to the reduction of transaction costs and create incentives for more competition in formal cross border trade with india in times of negative shocks such as the high food price crisis in 2008 restrictive food trade policies in india will continue to undermine household food security in nepal

testing market integration a model of spatial price differentials for a tradable good is proposed which avoids the inferential dangers of received methods using static price correlations the proposed method also extracts more information on the causes of price differentials from the same data the method is illustrated using monthly rice price data for postindependence bangladesh including the very substantial regional price shocks during the 1974 famine impediments to market integration are indicated

testing for food market integration revisited this article considers the statistical performance of four commonly used econometric tests for market integration the law of one price the ravallion model cointegration and granger causality a spatial price equilibrium spe model that is subject to both production shocks and general price inflation and mimics many of the key characteristics of integrated food markets is constructed the model is used to generate food price time series of lengths that are typical of the short sample sizes available in most developing countries for both instantaneously integrated and independent markets a series of monte carlo experiments on these artificial food price time series are performed which show that all four of the conventional tests for market integration are statistically flawed

spatial market integration in the presence of threshold effects a large body of research has evaluated price linkages in spatially separate markets much recent research has applied models appropriate for nonstationary data such analyses have been criticized for their ignorance of transactions costs which may inhibit price adjustments and thus affect tests of integration this analysis utilizes threshold autoregression and cointegration models to account for a neutral band representing transactions costs we evaluate daily price linkages among four corn and four soybean markets in north carolina nonlinear impulse response functions are used to investigate dynamic patterns of adjustments to shocks our results confirm the presence of thresholds and indicate strong support for market integration though adjustments following shocks may take many days to be complete in every case the threshold models suggest much faster adjustments in response to deviations from equilibrium than is the case when threshold behavior is ignored a large amount of empirical research has evaluated the extent to which spatially separate markets are integrated though the term is used loosely in the literature tests of market integration usually consider the extent to which shocks are transmitted among spatially separate markets the integration of markets can have important implications for price discovery and the operation of the market since persistent deviations from integration may imply riskless profit opportunities for spatial traders