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Interregional integration of wheat markets in Kazakhstan

Interregionale Integration von Weizenmärkten in Kasachstan

Stephan Brosig () and Yorbol Yahshilikov
Authors registered in the RePEc Author Service: Yorbol Yakhshilikov ()

No 88, IAMO Discussion Papers from Leibniz Institute of Agricultural Development in Transition Economies (IAMO)

Abstract: Reliable marketing opportunities in both interregional and international trade along with relatively low transportation [and transaction] costs are essential to profitability of wheat production. In this study we have investigated one aspect of the quality of marketing and trade opportunities in the Kazakh wheat sector, that is the extent and nature of integration among regional wheat markets. We applied threshold cointegration technique to assess the co-movement between time series of elevator prices at three grain-trading (and producing) spots in the northern and central parts of the country. Results suggest that markets of two northern grain trading spots (Petropavlovsk and Kokshetau) are closely connected with each other while their connection with Karaganda in central Kazakhstan is much weaker. Here, levelling out of price gaps through arbitrage trade only occurs after a threshold of considerable extent has been surpassed.

Keywords: Kazakhstan; Price transmission; Market integration; Threshold cointegration; Kasachstan; Preistransmission; Marktintegration; Kointegration (search for similar items in EconPapers)
JEL-codes: C22 Q13 (search for similar items in EconPapers)
Date: 2005
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