Abstract:The extent, pattern, and degree of integration are analyzed in a multivariate system with cointegrating restrictions. The extent of the market is found by identifying locations that are linked by trade and where prices share identical long-run information (permanent component). The pattern of integration characterizes interdependence and is analyzed by estimating a vector error correction model. The degree of integration is calculated with persistence profiles of the long run relations. We demonstrate that biv… Show more
“…However, there are (n 2 -n)/2 possible pairs. Hence, all but n-1 pairs will be redundant (Asche, Bremnes and Wessells, 1999;Gonzalez-Rivera and Helfand, 2001). A potential problem is therefore that one might obtain different conclusions depending on which pairs one chooses in applied work, although this is theoretically impossible.…”
This article examines the Japanese market for salmon. This market is of interest, since it is the largest and most diversified salmon market in the world with wild and farmed species, from Europe and South and North America, competing in the same market. In contrast to the European Union (EU)- and U.S.-markets, there have been neither trade conflicts nor trade restrictions. The Japanese market can hence provide information about the impact of bringing substantial quantities of a new product into a market, and the effect of large-scale aquaculture on traditional fisheries. In this article, market integration between wild and farmed salmon on the Japanese market is examined, using both bivariate and multivariate cointegration analysis. Tests for the Law of One Price are also conducted. The results indicate that the species are close substitutes on the market, and that the expansion of farmed salmon has resulted in price decreases for all salmon species. Copyright 2005 International Association of Agricultural Economics.
“…However, there are (n 2 -n)/2 possible pairs. Hence, all but n-1 pairs will be redundant (Asche, Bremnes and Wessells, 1999;Gonzalez-Rivera and Helfand, 2001). A potential problem is therefore that one might obtain different conclusions depending on which pairs one chooses in applied work, although this is theoretically impossible.…”
This article examines the Japanese market for salmon. This market is of interest, since it is the largest and most diversified salmon market in the world with wild and farmed species, from Europe and South and North America, competing in the same market. In contrast to the European Union (EU)- and U.S.-markets, there have been neither trade conflicts nor trade restrictions. The Japanese market can hence provide information about the impact of bringing substantial quantities of a new product into a market, and the effect of large-scale aquaculture on traditional fisheries. In this article, market integration between wild and farmed salmon on the Japanese market is examined, using both bivariate and multivariate cointegration analysis. Tests for the Law of One Price are also conducted. The results indicate that the species are close substitutes on the market, and that the expansion of farmed salmon has resulted in price decreases for all salmon species. Copyright 2005 International Association of Agricultural Economics.
“…There is a possibility of accidental correlation 19 , although this is also interpreted as evidence of inter-market transactions. Second, in many practical analyses, models to measure the degree of market integration often require strong assumptions concerning transaction costs 2,4,16,18 . The EG test and ECM in this paper also assume a linear relationship between prices in integrated markets.…”
Section: Discussionmentioning
confidence: 99%
“…Transactions surrounding 22 UB (9,12,13,14,17,18,19,22), Z China (2,5,7,14,16,19,20), Z Russia (1,3,4,8,11,17,19,21), Z Mt Khangai (1, 2, 3, 4, 5, 7), Z Forest (8,11,13,17) and Z UB (22).…”
Section: Spatial Characteristics Of Market Integrationmentioning
This paper evaluates the spatial linkages between the livestock product markets in Mongolia and the effects of road conditions on market transactions. It is based on the Engle-Granger test, an error correction model, and a model of market integration using the monthly price datasets of livestock products in Mongolia during [2005][2006][2007][2008][2009]. Empirical analysis indicates that the most and least integrated markets are the cashmere and milk markets, respectively. Extending paved roads might tighten the integration of the livestock products markets.
“…As can be seen from table 4 above the null of 4, 3 and 2 common 16 Testes are done for each lag but it is presented at 15 th cumulative lag. Since each lag is independent and have chi2 distribution their sum or their cumulative value will also have chi2 distribution 17 It is observed that in these case most of the information criterions were picking the same lag. So it could be possible that the performance of the information criterions is dependent on white noisiness of the data.…”
Section: Cointegration Analysis To Search For Markets Under Rule Of Omentioning
confidence: 95%
“…First the highest probability of serial correlation observed in any cumulative lag from 1 to 15 th . In case the statistics is significant additional statistics is given in cumulative lag selected by information criterions 17 . And for these markets the highest serial correlation is observed at 9 th cumulative lag but still it is not significant even at 15% and there is no need for second statistics.…”
Section: Cointegration Analysis To Search For Markets Under Rule Of Omentioning
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