IDEAS home Printed from https://ideas.repec.org/p/ags/eaae11/114545.html
   My bibliography  Save this paper

Relationship Between Spatial Price Transmission And Geographical Distance In Brazil

Author

Listed:
  • Hernandez-Villafuerte, Karla Vanessa

Abstract

The price transmission between markets is often interpreted as providing insights into the market’s infrastructure efficiency and transaction costs. Thus, finding a possible explanation for the degree of integration has become an issue of special interest. Recent researchers have pointed out the distance between markets as one of the possible factors. However, the distance is closely related with other elements, such as road quality and the proximity to an export point, which affect transport costs, opportunity costs and thus the integration. Therefore, what the most important factor is when determining the relationship among markets remains unclear. The cointegration framework, OLS and principal component regressions are applied in order to investigate the influence of geographical distance on the cointegration relationship between Brazil`s rice markets. In response to changes of the agricultural policies during the period of investigation, the presence of multiple structural breaks in the long run equation is allowed. The results point out a weak, negative and significant relation between distance and the elasticity of cointegration. Moreover, the region in which the market is located and a better access to export points are the main variables which defined the strength of the price transmission.

Suggested Citation

  • Hernandez-Villafuerte, Karla Vanessa, 2011. "Relationship Between Spatial Price Transmission And Geographical Distance In Brazil," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114545, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae11:114545
    DOI: 10.22004/ag.econ.114545
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/114545/files/Hernandez-Villafuerte_Karla_307.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.114545?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
    ---><---

    References listed on IDEAS

    as
    1. Jushan Bai & Pierre Perron, 1998. "Estimating and Testing Linear Models with Multiple Structural Changes," Econometrica, Econometric Society, vol. 66(1), pages 47-78, January.
    2. Kejriwal, Mohitosh & Perron, Pierre, 2010. "Testing for Multiple Structural Changes in Cointegrated Regression Models," Journal of Business & Economic Statistics, American Statistical Association, vol. 28(4), pages 503-522.
    3. Thomas Gries & Wim Naudé & Marianne Matthee, 2009. "The Optimal Distance To Port For Exporting Firms," Journal of Regional Science, Wiley Blackwell, vol. 49(3), pages 513-528, August.
    4. Javier Escobal & Arturo Vásquez, 2005. "Market integration for agricultural output markets in Peru: the role of public infrastructure," Urban/Regional 0507003, University Library of Munich, Germany.
    5. Gregory, Allan W. & Hansen, Bruce E., 1996. "Residual-based tests for cointegration in models with regime shifts," Journal of Econometrics, Elsevier, vol. 70(1), pages 99-126, January.
    6. Mevik, Björn-Helge & Wehrens, Ron, 2007. "The pls Package: Principal Component and Partial Least Squares Regression in R," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 18(i02).
    7. Gloria González-Rivera & Steven M. Helfand, 2001. "The Extent, Pattern, and Degree of Market Integration: A Multivariate Approach for the Brazilian Rice Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(3), pages 576-592.
    8. Sanogo, Issa, 2008. "SPATIAL integration of the rice market: emprirical evidence from mid-west and far-west Nepal and the Nepalese-Indian border," MPRA Paper 14488, University Library of Munich, Germany.
    9. Steven M. Helfand & Gervásio Castro de Rezende, 2015. "Brazilian Agriculture in the 1990s: Impact of the Policy Reforms," Discussion Papers 0098, Instituto de Pesquisa Econômica Aplicada - IPEA.
    10. Alemu, Zerihun Gudeta & Biacuana, G.R., 2006. "Measuring Market Integration in Mozambican Maize Markets: A Threshold Vector Error Correction Approach," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25657, International Association of Agricultural Economists.
    11. King, Gary & Honaker, James & Joseph, Anne & Scheve, Kenneth, 2001. "Analyzing Incomplete Political Science Data: An Alternative Algorithm for Multiple Imputation," American Political Science Review, Cambridge University Press, vol. 95(1), pages 49-69, March.
    Full references (including those not matched with items on IDEAS)

    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. Matteo Mogliani, 2010. "Residual-based tests for cointegration and multiple deterministic structural breaks: A Monte Carlo study," Working Papers halshs-00564897, HAL.
    2. Boetel, Brenda L. & Liu, Donald J., 2008. "Incorporating Structural Changes in Agricultural and Food Price Analysis: An Application to the U.S. Beef and Pork Sectors," Working Papers 44076, University of Minnesota, The Food Industry Center.
    3. Joscha Beckmann & Ansgar Belke & Michael Kühl, 2009. "How Stable Are Monetary Models of the Dollar-Euro Exchange Rate?: A Time-Varying Coefficient Approach," Discussion Papers of DIW Berlin 944, DIW Berlin, German Institute for Economic Research.
    4. Esteve, Vicente & Navarro-Ibáñez, Manuel & Prats, María A., 2013. "The Spanish term structure of interest rates revisited: Cointegration with multiple structural breaks, 1974–2010," International Review of Economics & Finance, Elsevier, vol. 25(C), pages 24-34.
    5. Travaglini, Guido, 2007. "The U.S. Dynamic Taylor Rule With Multiple Breaks, 1984-2001," MPRA Paper 3419, University Library of Munich, Germany, revised 15 Jun 2007.
    6. Jérôme Trinh, 2022. "Testing for cointegration with structural changes in very small sample," THEMA Working Papers 2022-01, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    7. Tarlok Singh, 2017. "Are Current Account Deficits in the OECD Countries Sustainable? Robust Evidence from Time-Series Estimators," The International Trade Journal, Taylor & Francis Journals, vol. 31(1), pages 29-64, January.
    8. Elena Claire Ricci & Massimo Peri & Lucia Baldi, 2019. "The Effects of Agricultural Price Instability on Vertical Price Transmission: A Study of the Wheat Chain in Italy," Agriculture, MDPI, vol. 9(2), pages 1-14, February.
    9. Joscha Beckmann & Ansgar Belke & Michael Kühl, 2011. "Cointegration, structural breaks and monetary fundamentals of the Dollar/Yen Exchange," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 17(4), pages 397-412, November.
    10. Joscha Beckmann & Ansgar Belke & Michael Kühl, 2011. "The dollar-euro exchange rate and macroeconomic fundamentals: a time-varying coefficient approach," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(1), pages 11-40, April.
    11. repec:zbw:rwirep:0134 is not listed on IDEAS
    12. Alexander Ludwig, 2014. "Credit risk-free sovereign bonds under Solvency II: a cointegration analysis with consistently estimated structural breaks," Applied Financial Economics, Taylor & Francis Journals, vol. 24(12), pages 811-823, June.
    13. Natalya Ketenci & Vasudeva N. R. Murthy, 2018. "Some determinants of life expectancy in the United States: results from cointegration tests under structural breaks," Journal of Economics and Finance, Springer;Academy of Economics and Finance, vol. 42(3), pages 508-525, July.
    14. Cuneyt Dumrul & Yasemin Dumrul, 2015. "Price-Money Relationship after Infl ation Targeting: Co-integration Test with Structural Breaks for Turkey and Brazil," International Journal of Economics and Financial Issues, Econjournals, vol. 5(3), pages 701-708.
    15. Beyer, Andreas & Dewald, William G. & Haug, Alfred A., 2009. "Structural breaks, cointegration and the Fisher effect," Working Paper Series 1013, European Central Bank.
    16. Natalya KETENCİ & Ebru Tomris AYDOĞAN, 2019. "Determinants of Economic Growth in Turkey in the Presence of Structural Breaks," Sosyoekonomi Journal, Sosyoekonomi Society, issue 27(42).
    17. Luis F. Martins & Paulo M. M. Rodrigues, 2022. "Tests for segmented cointegration: an application to US governments budgets," Empirical Economics, Springer, vol. 63(2), pages 567-600, August.
    18. repec:kap:iaecre:v:17:y:2011:i:4:p:397-412 is not listed on IDEAS
    19. Philipp Lieberknecht & Philip Vermeulen, 2022. "Wealth and income inequality in the long run," CAMA Working Papers 2022-37, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    20. Mylonidis, Nikolaos & Kollias, Christos, 2010. "Dynamic European stock market convergence: Evidence from rolling cointegration analysis in the first euro-decade," Journal of Banking & Finance, Elsevier, vol. 34(9), pages 2056-2064, September.
    21. Karsten Schweikert, 2022. "Oracle Efficient Estimation of Structural Breaks in Cointegrating Regressions," Journal of Time Series Analysis, Wiley Blackwell, vol. 43(1), pages 83-104, January.
    22. Joscha Beckmann & Ansgar Belke & Michael Kühl, 2009. "How Stable Are Monetary Models of the Dollar-Euro Exchange Rate? - A Time-varying Coefficient Approach," Ruhr Economic Papers 0134, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.

    More about this item

    Keywords

    Demand and Price Analysis;

    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:ags:eaae11:114545. 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: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/eaaeeea.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.