IDEAS home Printed from https://ideas.repec.org/a/pid/journl/v36y1997i3p241-262.html
   My bibliography  Save this article

Integration of Agricultural Commodity Markets in Punjab

Author

Listed:
  • Zubair Tahir

    (International Irrigation Management Institute (IIMI), Pakistan.)

  • Khalid Riaz

    (UN Department of Economic and Social Affairs, Sustainable Water Resources Management Project, Yemen.)

Abstract

Efficiency of resource allocation in agriculture depends on the functioning of commodity markets. Although the larger markets that are better connected with the transport and communication network are expected to be well-integrated, the same cannot be said about the smaller, more remote markets. This paper tests integration of agricultural commodity markets in Southeastern Punjab. The region is located off the main trading axis of Pakistan, the Peshawar-Karachi highway, and is mostly served by relatively small markets known as mandis. This study focuses on markets for cotton, wheat, and rice in five towns in the region. Cotton and wheat are the main crops in the area while rice is mostly grown as part of crop rotation aimed at controlling salinity. The analytical framework developed by Ravallion was used to conduct tests of market integration for the three selected commodities. Within this framework, it is possible to test for short-run integration, long-run integration or complete market segmentation. The results indicate that, generally, markets are integrated only in the long run, with short-run integration limited to some special cases. Moreover, the smaller markets are more likely to be isolated as compared to the larger markets. The small markets also take longer to fully adjust to the price shock originating from a more dominant central market. Finally, in the case of rice, it is more likely that a market would be isolated if it were small. This implies that farmers’ incentives to grow rice as a means of combating salinity may be constrained by local demand conditions.

Suggested Citation

  • Zubair Tahir & Khalid Riaz, 1997. "Integration of Agricultural Commodity Markets in Punjab," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 36(3), pages 241-262.
    • Handle: RePEc:pid:journl:v:36:y:1997:i:3:p:241-262
    as

    Download full text from publisher

    File URL: http://www.pide.org.pk/pdf/PDR/1997/Volume3/241-262.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Riaz, Khalid, 1994. "Food consumption patterns in rural Pakistan," ISU General Staff Papers 1994010108000011501, Iowa State University, Department of Economics.
    2. Faiz Mohammad, 1977. "Pricing Efficiency in Agricultural Markets in Pakistan," PIDE-Working Papers 1977:106, Pakistan Institute of Development Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wani, M.H. & Paul, Ranjit Kumar & Bazaz, Naseer H. & Manzoor, M., 2015. "Market integration and Price Forecasting of Apple in India," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 70(2), pages 1-13.
    2. Hussain, Babar, 2011. "Testing the law of one price in gram markets of Pakistan," MPRA Paper 30600, University Library of Munich, Germany, revised 01 Apr 2011.
    3. Ahmad, Munir & Croraton, Caesar & Qayyum, Abdul & Iqbal, Muhammad & Dorosh, Paul, 2005. "Impact of Domestic Policies towards Agricultural Trade Liberalization and Market Reform on Food Security in Pakistan," MPRA Paper 72932, University Library of Munich, Germany.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Huffman, Sonya Kostova, 1999. "Changes of household consumption behavior during the transition from centrally-planned to market-oriented economy," ISU General Staff Papers 1999010108000013568, Iowa State University, Department of Economics.
    2. Faiz Mohammad, 1985. "Farm Prices and the Green Revolution. Some Reflections on the Performance of Private Agricultural Markets in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 24(2), pages 103-123.
    3. Ahmad, Munir & Croraton, Caesar & Qayyum, Abdul & Iqbal, Muhammad & Dorosh, Paul, 2005. "Impact of Domestic Policies towards Agricultural Trade Liberalization and Market Reform on Food Security in Pakistan," MPRA Paper 72932, University Library of Munich, Germany.
    4. Ashfaq, Muhammad & Parton, Kevin A. & Griffith, Garry R. & Piggott, Roley R., 1999. "A Multilevel Economic Analysis of the Wheat Market in Pakistan," 1999 Conference (43th), January 20-22, 1999, Christchurch, New Zealand 123757, Australian Agricultural and Resource Economics Society.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pid:journl:v:36:y:1997:i:3:p:241-262. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Khurram Iqbal (email available below). General contact details of provider: https://edirc.repec.org/data/pideipk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.