Threshold Effects and Asymmetric Price Adjustments in the Ghanaian Plantain Market

Henry de-Graft Acquah

Journal of Economics and Behavioral Studies, 2012, vol. 4, issue 10, 548-554

Abstract: This study investigates if there is an asymmetric relationship between Ghanaian retail and wholesale plantain prices. Using the Consistent Threshold Autoregressive Model(C-TAR), this study finds that the retail and wholesale plantain prices are threshold co integrated. The study also finds that the retail and wholesale plantain prices adjust asymmetrically for deviation from the long run equilibrium. The findings of this study further indicate that 63.2% of the positive deviations and 24.9% of the negative deviations persist to the next period. These results suggest that any price movement that squeezes the margins is transmitted more rapidly than an equivalent that stretches the margin.

Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:rnd:arjebs:v:4:y:2012:i:10:p:548-554

DOI: 10.22610/jebs.v4i10.356

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