IDEAS home Printed from https://ideas.repec.org/a/taf/applec/v52y2020i39p4250-4262.html
   My bibliography  Save this article

Impact of food price volatility on the US restaurant sector

Author

Listed:
  • Gazi Salah Uddin
  • Jose Arreola Hernandez
  • Anupam Dutta
  • Sang Hoon Kang
  • Seong-Min Yoon

Abstract

Although fluctuations in agricultural commodity prices appear to be a source of risk to the US restaurant sector, the effect that volatility of food price has on the performance (returns) of that sector receives little or no attention in the relevant literature. We fill this gap by modelling the price and returns of corn and wheat and the volatilities of the US restaurant equity sector through a GARCH-jump intensity model. We find evidence indicating that the US restaurant sector is sensitive to food volatility shocks. Food price volatility negatively impacts US restaurant sector equity returns, implying that increases in food price volatility undermine restaurant sector performance. Also, food price volatility is observed to influence the restaurant sector symmetrically, indicating that changes in food volatility (increases and decreases) have homogeneous effects on the US restaurant sector performance. Implications of the results are discussed.

Suggested Citation

  • Gazi Salah Uddin & Jose Arreola Hernandez & Anupam Dutta & Sang Hoon Kang & Seong-Min Yoon, 2020. "Impact of food price volatility on the US restaurant sector," Applied Economics, Taylor & Francis Journals, vol. 52(39), pages 4250-4262, August.
    • Handle: RePEc:taf:applec:v:52:y:2020:i:39:p:4250-4262
    DOI: 10.1080/00036846.2020.1733478
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/00036846.2020.1733478
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/00036846.2020.1733478?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

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


    Cited by:

    1. Jaehee Gim & SooCheong Jang, 2024. "The determinants of aggressive share buybacks: An empirical examination of U.S. publicly traded restaurant firms," Tourism Economics, , vol. 30(1), pages 132-151, February.

    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:taf:applec:v:52:y:2020:i:39:p:4250-4262. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/RAEC20 .

    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.