Journal Article

Asymmetric price transmission in the Spanish lamb sector

M. Ben-Kaabia and José M. Gil

in European Review of Agricultural Economics

Volume 34, issue 1, pages 53-80
Published in print March 2007 | ISSN: 0165-1587
Published online March 2007 | e-ISSN: 1464-3618 | DOI: https://dx.doi.org/10.1093/erae/jbm009
Asymmetric price transmission in the Spanish lamb sector

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  • Multiple or Simultaneous Equation Models; Multiple Variables
  • Agricultural Economics
  • Market Structure, Firm Strategy, and Market Performance

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This article investigates the non-linear adjustment between farm and retail prices in the lamb sector in Spain, using a three-regime Threshold Autoregressive Model. The results indicate that, in the long run, price transmission is perfect and any supply or demand shocks are fully transmitted along the marketing chain. In the short run, price adjustments between the farm and the retail levels are asymmetric and reveal a demand-pull transmission mechanism. On the other hand, retailers benefit from any shock, whether positive or negative, that affects supply or demand conditions.

Keywords: asymmetries; non-linear adjustments; lamb prices; Spain; C32; L11; Q11; Q13

Journal Article.  10227 words.  Illustrated.

Subjects: Multiple or Simultaneous Equation Models; Multiple Variables ; Agricultural Economics ; Market Structure, Firm Strategy, and Market Performance

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