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Demand peaks and cost pass‐through: The case of Iran's poultry market

Omid Zamani, Thomas Bittmann and Jens‐Peter Loy

Agribusiness, 2019, vol. 35, issue 4, 657-674

Abstract: This study employs traditional holidays in Iran as proxies to analyze the impact of periods of peak demand on cost pass‐through in the poultry market. We use weekly wholesale and retail price data for all 30 provinces of Iran from 2010 to 2016. By panel cointegration techniques, we estimate cost pass‐through elasticities and speed of adjustment during periods of peak demand. We find that cost pass‐through elasticities slightly increase; the speed of adjustment in periods of peak demand remains the same, but retail–wholesale margins decrease. Thus, peak demand leads to an increase in retail–wholesale competition similarly observed by Chevalier et al. (2003, Am Econ Rev, 93, 15–37).

Date: 2019
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