Dynamics of Price-Cost Margins in the U.S. Meat Industry

Benaissa Chidmi () and Mohamadou L. Fadiga

No 9745, 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon from American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association)

Abstract: This study analyses the stochastic behavior of price-cost margins (PCMs) in the U.S. meat industry. It, first, develops and estimates a vertical relationship economic model to derive PCMs in the U.S. meat industry (Beef, Pork, and Poultry). Second it analyzes the behavior of PCMs by decomposing them into their seasonal, cyclical, and trend components using the state-space and the Kalman filtering methods. Price-cost margins in the U.S. meat industry are governed by two common trends and two common cycles. The study also found cyclical variability of PCMs is the highest with chicken, secular variability of PCMs is the highest with pork, while seasonal variability of PCMs is the highest with beef.

Keywords: Demand and Price Analysis; Livestock Production/Industries (search for similar items in EconPapers)
Pages: 26
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea07:9745

DOI: 10.22004/ag.econ.9745

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