A Reexamination of Price Dynamics in the International Wheat Market

Samarendu Mohanty, William H. Meyers and Darnell B. Smith

No 18354, Hebrew University of Jerusalem Archive from Hebrew University of Jerusalem

Abstract: This paper examines price relationships in the international wheat market using a cointegration and error correction approach. Price series are found to be first difference stationary and cointegrated. Our results provide evidence that the United States, Australia, the European Union, and Argentina react to Canada's pricing decisions whereas Canada does not respond to any other price changes except Australia's. Similarly, the United States also plays a strong role in the pricing of other exporters (except Canada) and its U.S. pricing decision is affected by changes in Canadian and Australian prices. The remaining exporters such as the European Union and Argentina respond to the U.S. and Canadian price changes but do not have any influence on other prices. Overall, our results suggest that there is no distinct price leader in the international wheat market.

Keywords: Demand and Price Analysis; International Relations/Trade (search for similar items in EconPapers)
Pages: 19
Date: 1996
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Persistent link: https://EconPapers.repec.org/RePEc:ags:hebarc:18354

DOI: 10.22004/ag.econ.18354

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