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Redefining integration of the European dairy markets: do they converge?

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  • Karelakis, Christos

Abstract

The European dairy market has received inefficient protection through the years within the context of significant policy reforms. Until the next reform, the various protection measures will be gradually dismantled, fostering the competitiveness of the sector. The present paper exploits the prospects of an integrated European dairy market with the investigation of the price behaviour for EU countries through the Purchasing Power Parity (PPP) and the assistance of the Johansen cointegration technique. Three major groups of dairy markets have been identified for which a single cointegration vector is confirmed. The results validate the existence of a long-run relationship among real exchange rates based on dairy prices for these groups of countries, whereas, weakly exogenous variables existed across all groups, offering the other countries within each group, protection against external shocks and adversaries of price volatility.

Suggested Citation

  • Karelakis, Christos, 2019. "Redefining integration of the European dairy markets: do they converge?," Agricultural Economics Review, Greek Association of Agricultural Economists, vol. 0(Issue 01).
    • Handle: RePEc:ags:aergaa:330636
    DOI: 10.22004/ag.econ.330636
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    References listed on IDEAS

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