Explaining coffee price differentials in terms of chemical markers: Evidence from a pairwise approach
Ricardo Arguello (),
Juan Daniel Oviedo and
Economic Modelling, 2018, vol. 72, issue C, 190-201
We use time-series and cross-section methods to study long-term relationships between pairs of coffee prices, and assess how chemical, institutional and market factors affect the likelihood of finding stationary price differentials, the magnitude of such differentials, and their speed of adjustment. Using an empirical approach which does not require classifying coffee varieties as reference and non-reference, we find that varieties with chemical similarity have prices which are more similar, more likely to maintain stable long-term relationships, and more quickly to adjust after a shock.
Keywords: Coffee; Price differentials; Chemical markers; Quality differences (search for similar items in EconPapers)
JEL-codes: C31 C32 Q17 Q18 (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:72:y:2018:i:c:p:190-201
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