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SummaryWe study price transmission processes within EU pork markets after the implementation of the EU single market in 1993. We compare results derived from nonparametric regressions with those obtained using alternative nonlinear threshold models. Both techniques support the hypothesis that prices are transmitted across spatially separate EU pig markets and provide evidence for asymmetric price adjustments. They also suggest the existence of a range of price differentials where equilibrating price adjustments are less intense. Nonparametric techniques often suggest a higher degree of price transmission than that implied by threshold models.

The aim of this paper is to analyse the main determinants of consumers' knowledge and their willingness to pay for organic food products. Moreover, the relationship between knowledge and buying behaviour is explored. Virgin olive oil is taken as an example. Data was generated by way of an experimental auction carried out in two cities in northeast Spain. A three-equation model is estimated: 1) Consumer knowledge; 2) the decision to pay a premium for organic olive oil; and 3) how much premium consumers are willing to pay. Results indicate that socio-economic variables are main determinants of consumer knowledge, and that consumer attitude, lifestyle and knowledge all influence the decision to pay a premium for organic olive oil.

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The study of spatial price relationships contributes to explain markets performance, their degree of integration or isolation, and the speed at which information is transmited. A great deal of methods have been used to analyze this issue, being the most important: causality tests, impulseresponse functions and cointegration. Normally, these techniques have been individually applied. However, a more rich knowledge of markets performance can be extracted when they are jointly applied. In this paper, we try to conjugate these three techniques in a common econometric model. First, Johansen(1988) multivariate cointegration tests are used to determine the number of long-run equilibrium relationships. Cointegration is considered not only as informative about long-run price transmission but also as an essential step in the correct specification of a vector error correction model (VECM) used in the subsequent analysis. Second, Dolado and Lütkepohl (1996) causality tests are used to investigate the lead-lag behaviour among markets. Finally, impulse-response functions are calculated from the VECM estimated in the first stage for evaluating short-run dynamic price linkages. The method exposed is applied to the study of spatial pork prices relationships among seven countries in the EU using weekly data from 1988 to 1995.