Agricultural Market Integration in India

Michal Andrle and Patrick Blagrave

No 2020/115, IMF Working Papers from International Monetary Fund

Abstract: We assess the degree of cross-market price discrepancy (a proxy for market integration), its evolution over time, and proximate determinants, using monthly price data for 21 agricultural goods and 60 markets in India. Econometric analysis shows that cross-market price integration is positively associated with the level of transportation infrastructure, and distance between market pairs. There is no robust evidence that price integration has increased in recent years, suggesting that any positive effects of recent policy initiatives are either small, outweighed by the identified determinants of integration, or yet to come.

Keywords: WP; market integration; market; markup; cross-market markup; markups vis-à-vis; cross-market dispersion; price integration; cross-market trade; price dispersion; cross-region price discrepancy; Agricultural commodities; Infrastructure; Agricultural sector; Transportation; Global; Price transmission; India (search for similar items in EconPapers)
Pages: 20
Date: 2020-07-03
New Economics Papers: this item is included in nep-agr
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