Title: Price transmission along the Greek food supply chain in a dynamic panel framework: empirical evidence from the implementation of decoupling
Authors: Anthony N. Rezitis; Dimitris N. Pachis
Addresses: Faculty of Agriculture and Forestry, Department of Economics and Management, University of Helsinki, P.O. Box 27, Latokartanonkaari 5, FI-00014, Finland ' Department of Business Administration of Food and Agricultural Enterprises, University of Patras, 2 G. Seferis Str., Agrinio 30100, Greece
Abstract: This study investigates the price transmission mechanism between the producer and the consumer of the Greek food market while taking into consideration the decoupling policy scheme of the Common Agricultural Policy of the European Union. The empirical analysis uses the panel vector error correction model for the empirical investigation of the price mechanism. The dynamics of the price mechanism are evaluated in the short and long run with causality tests and impulse responses. The results show that the producer does not respond to long-run deviations from the equilibrium. Moreover, a shock in the producer or the consumer prices results in own disequilibrium effects that are quickly decayed and disequilibrium spillover effects from one price level to the other that take time to decay. Finally, the implementation of the decoupling scheme seems to have benefited the consumer more rather than the producer in mitigating his responses to own and cross-price shocks.
Keywords: prices; panel VEC; asymmetries; decoupling; Greece.
International Journal of Computational Economics and Econometrics, 2018 Vol.8 No.1, pp.18 - 40
Available online: 18 Sep 2017 *Full-text access for editors Access for subscribers Free access Comment on this article