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Spatial price dynamics in the US vegetable sector

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  • Samantha L. Durborow
  • Seon‐Woong Kim
  • Shida R. Henneberry
  • B. Wade Brorsen

Abstract

This study investigates price transmission in the US fresh vegetable market, considering four important vegetables: carrots, lettuce, onions, and potatoes. An asymmetric variable‐threshold autoregressive (AvTAR) model was used to estimate price relationships between 40 pairs of terminal market vegetable prices, whereas the parity bounds model (PBM) was used to estimate the probability of 22 shipping point to terminal market pairs behaving efficiently. The estimated AvTAR models suggest market integration is higher for more perishable produce. Results for the PBM indicate that 18.2% of the markets studied had more than a 10% probability of behaving inefficiently, indicating that while the majority of markets behaved efficiently, there is room for improvement. The estimated thresholds have been suggested as an estimate of transport costs, but estimated thresholds often differ substantially from actual transport costs.

Suggested Citation

  • Samantha L. Durborow & Seon‐Woong Kim & Shida R. Henneberry & B. Wade Brorsen, 2020. "Spatial price dynamics in the US vegetable sector," Agribusiness, John Wiley & Sons, Ltd., vol. 36(1), pages 59-78, January.
  • Handle: RePEc:wly:agribz:v:36:y:2020:i:1:p:59-78
    DOI: 10.1002/agr.21603
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    References listed on IDEAS

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    1. Fan, Xiaoli & Gómez, Miguel I. & Atallah, Shady S. & Hernandez, Juan, 2014. "Examining Seasonality of Spatial Efficiency in the U.S. Fresh Broccoli Market," 2014 Annual Meeting, July 27-29, 2014, Minneapolis, Minnesota 170235, Agricultural and Applied Economics Association.
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    Cited by:

    1. Youzhu Li & Jinsi Liu & Hongyu Yang & Jianxin Chen & Jason Xiong, 2021. "A Bibliometric Analysis of Literature on Vegetable Prices at Domestic and International Markets—A Knowledge Graph Approach," Agriculture, MDPI, vol. 11(10), pages 1-17, September.
    2. Antonioli, Federico & Santeramo, Fabio Gaetano, 2022. "On Policy Interventions and Vertical Price Transmission: The Italian Milk Supply Chain Case," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 47(2), May.
    3. Miranda Svanidze & Linde Götz & Dmytro Serebrennikov, 2022. "The influence of Russia's 2010/2011 wheat export ban on spatial market integration and transaction costs of grain markets," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(2), pages 1083-1099, June.
    4. Youzhu Li & Miao Zhang & Jinsi Liu & Bingbing Su & Xinzhu Lin & Yuxuan Liang & Yize Bao & Shanshan Yang & Junjie Zhang, 2022. "Research on the Disturbance Sources of Vegetable Price Fluctuation Based on Grounded Theory and LDA Topic Model," Agriculture, MDPI, vol. 12(5), pages 1-14, April.
    5. Love, Erin & Thilmany, Dawn, 2022. "Price Transmission and Asymmetry in the Colorado Potato Supply Chain," Journal of Food Distribution Research, Food Distribution Research Society, vol. 53(3), November.

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