Abstract
In this article, the author's set out Jordà's (2005) method of local projections by which nonlinear/ asymmetric impulse responses can be computed without the need to specify and estimate the underlying nonlinear/asymmetric dynamic system. The method is used to compute price-reaction functions that show how the prices of the different stages in a food supply chain dynamically respond to each other and whether or not these responses reveal any asymmetric patterns. Empirical applications for the U.S. pork-meat and broiler-composite chains illustrate the convenience of the method and reveal that in the pork chain asymmetric price transmission enables retailers (wholesalers) to increase their marketing margin vis-à-vis the wholesalers (farmers), whereas in the broiler sector the retailers face both temporary decreases and increases in their marketing margin as a consequence of asymmetric wholesale-retail price transmission.
Original language | English |
---|---|
Pages (from-to) | 325-343 |
Journal | Agribusiness |
Volume | 29 |
Issue number | 3 |
DOIs | |
Publication status | Published - 2013 |
Keywords
- market