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Market Integration: Case Studies of Structural Change

Published online by Cambridge University Press:  15 September 2016

Jason R.V. Franken ,
Joe L. Parcell ,
Michael E. Sykuta  and
Christopher L. Fulcher
Jason R.V. Franken
Affiliation:
Department of Agricultural Economics, University of Illinois
Joe L. Parcell
Affiliation:
Department of Agricultural Economics, University of Missouri-Columbia
Michael E. Sykuta
Affiliation:
Department of Agricultural Economics, University of Missouri-Columbia
Christopher L. Fulcher
Affiliation:
Harry S. Truman School of Public Affairs, University of Missouri-Columbia
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Abstract

The grain/oilseed industry is undergoing considerable structural change through mergers and new value-added businesses, which raises price-related questions. We analyze the level of price integration prior to and following a merger between two grain firms and the start-up of a producer-owned ethanol facility. This research utilizes error correction vector autoregression analysis to compute market integration structural change effects. We find evidence that market integration initially increases with the merger, but deteriorates with time following the merger. We find no significant localized change in the level of price integration for the case of a new value-added business.

Keywords

consolidationstructural changeprice integration
Type
Contributed Papers
Information
Agricultural and Resource Economics Review , Volume 34 , Issue 2 , October 2005 , pp. 163 - 172
Copyright
Copyright © 2005 Northeastern Agricultural and Resource Economics Association 

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