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Evaluating Transmission Prices between Global Agricultural Markets and Consumers' Food Price Indices in the EU

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  • Garcia-German, Sol
  • Garrido, Alberto
  • Bardaji, Isabel

Abstract

The rise of price levels and volatility of world agricultural commodities since 2006-2008 was followed by increased and more volatile food price inflation around the world. Using error correction models, this paper evaluates the velocity and extent to which world agricultural commodity price movements affect consumer food prices in the 28 EU's Member States. Results show a significant long run relationship between world agricultural commodity prices and food consumer prices in over half of the Member States. They present varying long run price transmission elasticities and a slow adjustment of prices. In general first members of the Eurozone have lower transmission elasticities than the others.

Suggested Citation

  • Garcia-German, Sol & Garrido, Alberto & Bardaji, Isabel, 2014. "Evaluating Transmission Prices between Global Agricultural Markets and Consumers' Food Price Indices in the EU," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 183039, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaae14:183039
    DOI: 10.22004/ag.econ.183039
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    References listed on IDEAS

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    1. Gianluigi Ferrucci & Rebeca Jiménez-Rodríguez & Luca Onorantea, 2012. "Food Price Pass-Through in the Euro Area: Non-Linearities and the Role of the Common Agricultural Policy," International Journal of Central Banking, International Journal of Central Banking, vol. 8(1), pages 179-218, March.
    2. Christopher Gilbert & Wyn Morgan, 2010. "Has food price volatility risen?," Department of Economics Working Papers 1002, Department of Economics, University of Trento, Italia.
    3. Baquedano, Felix G. & Liefert, William M., 2014. "Market integration and price transmission in consumer markets of developing countries," Food Policy, Elsevier, vol. 44(C), pages 103-114.
    4. Suzanna De Boef & Luke Keele, 2008. "Taking Time Seriously," American Journal of Political Science, John Wiley & Sons, vol. 52(1), pages 184-200, January.
    5. Timothy J. Richards & Geoffrey M. Pofahl, 2009. "Commodity Prices and Food Inflation," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1450-1455.
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    Cited by:

    1. Valenciano, Jaime de Pablo & Battistuzzi, Miguel Angel Giacinti & Azcaráte, Tomás García, 2015. ""Banana War" And World Trade Changes," International Journal of Food and Agricultural Economics (IJFAEC), Alanya Alaaddin Keykubat University, Department of Economics and Finance, vol. 3(2), pages 1-12, April.

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    Demand and Price Analysis;

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