Market Integration in European Union’s Fruits and Vegetable Sectors

Abstract

The aim of this dissertation is to assess the degree of market integration in some F&V sectors through econometric techniques. In particular we estimated the speed of price transmission among closely located markets as well as the price transmission across different Regions. We consider products that differ for storability, incidence of transportation costs and production technologies so we are able to generalize our findings to the whole EU F&V sector. We employed Granger-Causality tests and estimated Ravallion-type regressions to identify the markets that mainly influence the prices of other markets in the same Region. Finally we adopted an asymmetric threshold autoregressive model to assess the speed of price transmisison. We show that the speed of price transmission decreases with the physical distance among markets and is affected by the degree of product storability.