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Price Transmission in Agricultural Markets

Author

Listed:
  • Stephan von Cramon-Taubadel

    (Department of Agricultural Economics and Rural Development, University of Göttingen, 37073 Göttingen, Germany)

  • Barry K. Goodwin

    (Department of Economics and Department of Agricultural and Resource Economics, North Carolina State University, Raleigh, North Carolina 27695, USA)

Abstract
We review recent developments in the analysis of price transmission in agricultural markets. Markets may be separated in time, form, and space (as well as in combinations of such factors). Transactions and storage costs as well as production and marketing factors delineate these markets. We show that much of the research on spatial market linkages has reflected methodological advances that have led to increasingly nonlinear time-series models. Advances in the theoretical and empirical literature over the last few decades have demonstrated that price relationships in the food chain are highly context specific. Improvements in marketing, information, and transportation technology have strengthened the links between prices in the food system, but at the same time links in the food chain are increasingly subject to vertical coordination and, thus, less visible to outside observers, including researchers.

Suggested Citation

  • Stephan von Cramon-Taubadel & Barry K. Goodwin, 2021. "Price Transmission in Agricultural Markets," Annual Review of Resource Economics, Annual Reviews, vol. 13(1), pages 65-84, October.
    • Handle: RePEc:anr:reseco:v:13:y:2021:p:65-84
    DOI: 10.1146/annurev-resource-100518-093938
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    Citations

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    Cited by:

    1. Anna Szczepańska-Przekota, 2023. "Are Small Agricultural Markets Recipients of World Prices? The Case of Poland," Agriculture, MDPI, vol. 13(6), pages 1-16, June.
    2. Jingjing Wang & Xiaoyang Wang & Xiaohua Yu, 2023. "Shocks, cycles and adjustments: The case of China's Hog Market under external shocks," Agribusiness, John Wiley & Sons, Ltd., vol. 39(3), pages 703-726, July.
    3. Carlotta Penone & Samuele Trestini, 2022. "Testing for asymmetric cointegration of Italian agricultural commodities prices: Evidence from the futures-spot market relationship," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 68(2), pages 50-58.
    4. Noé J. Nava & William Ridley & Sandy Dall'erba, 2023. "A model of the U.S. food system: What are the determinants of the state vulnerabilities to production shocks and supply chain disruptions?," Agricultural Economics, International Association of Agricultural Economists, vol. 54(1), pages 95-109, January.
    5. Alanoud Al-Maadid & Guglielmo Maria Caporale & Fabio Spagnolo & Nicola Spagnolo, 2017. "Spillovers between food and energy prices and structural breaks," International Economics, CEPII research center, issue 150, pages 1-18.
    6. Nino, Gustavo, 2024. "Disruption in Ground Transportation: The Effect of Landslides on Food Market Integration," 2024 Annual Meeting, July 28-30, New Orleans, LA 343594, Agricultural and Applied Economics Association.
    7. Will Martin & Nicholas Minot, 2022. "The impacts of price insulation on world wheat markets during the 2022 food price crisis," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 66(4), pages 753-774, October.
    8. Padilla, Samantha & Schulz, Lee L & Vaiknoras, Kate & MacLachlan, Matthew, 2021. "COVID-19 Working Paper: Changes in Regional Hog Slaughter During COVID-19," Administrative Publications 327340, United States Department of Agriculture, Economic Research Service.
    9. Khalid Khan & Chi-Wei Su & Adnan Khurshid & Muhammad Umar, 2022. "Are there bubbles in the vanilla price?," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 10(1), pages 1-16, December.
    10. Bensch, Gunther & Kaestner, Kathrin & Vance, Colin, 2023. "Pass-through of cocoa prices along the supply chain: What's left for farmers in Côte D'Ivoire?," Ruhr Economic Papers 1035, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    11. Azzam, Azzeddine & Dhoubhadel, Sunil, 2022. "COVID-19, Beef Price Spreads, and Market Power," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 47(2), May.
    12. Henry W. Kinnucan, 2022. "A note on the correspondence between horizontal and vertical price transmission," Journal of Agricultural Economics, Wiley Blackwell, vol. 73(3), pages 654-665, September.
    13. Hoffmann, Clemens & Kastens, Lina & vPortugal-Perez, Alberto & von Cramon-Taubadel, Stephan, 2024. "Trade policies and the transmission of international to domestic prices," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344313, International Association of Agricultural Economists (IAAE).
    14. Ramsey, Austin F. & Goodwin, Barry K., 2024. "A Different 'Law of One Price:' Missouri's Livestock Marketing Law of 1999," 2024 Annual Meeting, July 28-30, New Orleans, LA 343679, Agricultural and Applied Economics Association.
    15. Luca Cattivelli & Federico Antonioli, 2023. "When cointegration is interrupted: Price transmission analysis in the Italian dairy‐feed industry," Agribusiness, John Wiley & Sons, Ltd., vol. 39(3), pages 744-761, July.
    16. Ma, Meilin & Delgado, Michael S. & Wang, H. Holly, 2024. "Risk, arbitrage, and spatial price relationships: Insights from China's hog market under the African Swine Fever," Journal of Development Economics, Elsevier, vol. 166(C).
    17. Mittag, Franziska & Hess, Sebastian, 2022. "Der Markt für Körnerleguminosen in Deutschland - ein fragmentierter Markt?," 62nd Annual Conference, Stuttgart, Germany, September 7-9, 2022 329594, German Association of Agricultural Economists (GEWISOLA).
    18. Mu, Yali, 2024. "Measuring and benchmarking time-varying market efficiency," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344294, International Association of Agricultural Economists (IAAE).
    19. Janus, Thorsten, 2024. "Does export underreporting contribute to the resource curse?," World Development, Elsevier, vol. 181(C).
    20. Sergei Kharin & Zuzana Kapustova & Ivan Lichner, 2023. "Price transmission between maize and poultry product markets in the Visegrád Group countries: What is more nonlinear, egg or chicken?," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 69(12), pages 510-522.
    21. Johan Swinnen & Rob Vos, 2021. "COVID‐19 and impacts on global food systems and household welfare: Introduction to a special issue," Agricultural Economics, International Association of Agricultural Economists, vol. 52(3), pages 365-374, May.
    22. Yali Mu & Stephan von Cramon‐Taubadel, 2022. "Estimating dynamic market efficiency frontiers," Journal of Agricultural Economics, Wiley Blackwell, vol. 73(3), pages 633-653, September.

    More about this item

    Keywords

    law of one price; spatial market integration; vertical price transmission;
    All these keywords.

    JEL classification:

    • C58 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Financial Econometrics
    • F02 - International Economics - - General - - - International Economic Order and Integration

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