Price Transmission Mechanisms among Disaggregated Processing Stages of Food: Demand-Pull or Cost-Push?

Dae-Heum Kwon and Won W. Koo

No 49332, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin from Agricultural and Applied Economics Association

Abstract: The recent concurrent surges of food and commodity prices renew the debate on the causal directions between producer and consumer prices. To address this issue, we utilize the stage of processing system incorporating retail stage beyond crude, intermediate, and finished processing stages of food and employ the method proposed by Toda and Yamamoto (1995) and Dolado and Lütkepohl (1996) of Granger causality tests. The overall results show that consistent with theory of derived demand, the demand-pull mechanisms coexist with the cost-push processes in 1985-2001. However, the upward cost-push pressures dominate the demand-pull mechanism through various transmission channels in 2002-2008.

Keywords: Demand and Price Analysis; Marketing (search for similar items in EconPapers)
Pages: 31
Date: 2009
New Economics Papers: this item is included in nep-agr and nep-mkt
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea09:49332

DOI: 10.22004/ag.econ.49332

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