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Threshold Effects and Asymmetric Price Adjustments in the Ghanaian Plantain Market

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  • Henry de-Graft Acquah

Abstract

This study investigates if there is an asymmetric relationship between Ghanaian retail and wholesale plantain prices. Using the Consistent Threshold Autoregressive Model(C-TAR), this study finds that the retail and wholesale plantain prices are threshold co integrated. The study also finds that the retail and wholesale plantain prices adjust asymmetrically for deviation from the long run equilibrium. The findings of this study further indicate that 63.2% of the positive deviations and 24.9% of the negative deviations persist to the next period. These results suggest that any price movement that squeezes the margins is transmitted more rapidly than an equivalent that stretches the margin.

Suggested Citation

  • Henry de-Graft Acquah, 2012. "Threshold Effects and Asymmetric Price Adjustments in the Ghanaian Plantain Market," Journal of Economics and Behavioral Studies, AMH International, vol. 4(10), pages 548-554.
    • Handle: RePEc:rnd:arjebs:v:4:y:2012:i:10:p:548-554
    DOI: 10.22610/jebs.v4i10.356
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    References listed on IDEAS

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