Co- Integration and Causality Analysis in Major Natural Rubber Markets of Nigeria

Agbonkpolor N.B., Alufohai G.O., Mesike C.S. and A.G. Adindu

No 288321, 2017 Annual NAAE Conference, October 16-19, Abeokuta, Nigeria from Nigerian Association of Agricultural Economists

Abstract: The study investigated market integration of natural rubber across three major State markets, namely Edo, Delta and Akwa-Ibom, of the Nigeria us~ng Johansen Co-integration test, and Granger Causality by VECM. Empirical results for average monthly retail price data (N/kg) of natural rubber, covering the period January, 2005 to December, 2015 (11 years) indicated that Price series were not stationary in their level form. The Delta State price appeared to respond faster to changes than the Edo and Akwa-Ibom price. The study also showed the existence of co-integration among the studied markets. Granger causality showed unidirectional causality between Akwa-Ibom and Delta bidirectional for the other two market pairs. The significant coefficient of the error correction term showed immediate adjustment to changes in the longrun equilibrium.

Keywords: Marketing (search for similar items in EconPapers)
Pages: 6
Date: 2017-10
New Economics Papers: this item is included in nep-bec
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Persistent link: https://EconPapers.repec.org/RePEc:ags:naae17:288321

DOI: 10.22004/ag.econ.288321

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