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Asymmetric Price Relationships in the U.S. Broiler Industry

Published online by Cambridge University Press:  28 April 2015

John C. Bernard  and
Lois Schertz Willett
John C. Bernard
Affiliation:
Department of Agricultural, Resource, and Managerial Economics, Cornell University
Lois Schertz Willett
Affiliation:
Department of Agricultural, Resource, and Managerial Economics, Cornell University
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Abstract

This study presents a testing methodology to analyze potential price asymmetries among the farm, wholesale, and retail levels of the U.S. broiler industry. Lag length, direction of causality, and asymmetric relationships are empirically determined. Results suggest that concentration and power of the integrators in the industry have allowed the wholesale price to become the center, causal price in the market. Asymmetric price transmissions, however, are limited. While downward movements in the wholesale price are passed on more fully to growers than increases in the wholesale price, only consumers in the North Central region of the U.S. share a larger portion of wholesalers’ price increases than price decreases.

Keywords

asymmetrybroilersconcentrationGranger causalityprice transmission
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 28 , Issue 2 , December 1996 , pp. 279 - 289
Copyright
Copyright © Southern Agricultural Economics Association 1996

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