Distribution Dynamics of Food Price Inflation Rates in EU: An Alternative Conditional Density Estimator Approach

Angelos E. Liontakis and Christos T. Papadas

No 58084, 113th Seminar, September 3-6, 2009, Chania, Crete, Greece from European Association of Agricultural Economists

Abstract: This paper examines the existence of convergence and distribution dynamics of food price inflation rates within the European Union. Differences in such specific price index inflation rates and changes in their regional distributions reflect largely differences and developments in market conditions and structures. Traditional measures and approaches to β-convergence and σ-convergence, fail to capture sufficiently the evolving distributional dynamics. The latter includes possible mobility prospects within distributions and potential formation of clubs. To deal with these issues, the paper adopts developments in the literature of non parametric econometric methods and employs an alternative conditional density estimator as well. Implementation of this estimator is superior, not only to the restrictive discrete Markov chain approaches, but also to the usual estimation of conditional densities using stochastic kernels. The adopted estimator has smaller integrated mean square error than the conventional estimators. Panel data analysis of β-convergence is conducted too, using panel unit root tests. Data used are the harmonized consumer price indices of food and eleven specific food product groups for 15 European countries, older member states of the EU. Extracted evidence based on the estimates is presented, analyzed, and conclusions are discussed.

Keywords: Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety (search for similar items in EconPapers)
Pages: 17
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa113:58084

DOI: 10.22004/ag.econ.58084

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