Year: 2015 | Month: September | Volume 60 | Issue 3

Spatial Price Transmission in Kinnow Markets of Rajasthan State of India

Richard Kwasi Bannor and Sharma Madhu
DOI:10.5958/0976-4666.2015.00059.5

Abstract:

The study focused on assessing the spatial price transmission between kinnow markets pairs in Rajasthan state of India using weekly kinnow price series of 8 markets from 2010-2015. Coefficient of variance results indicates Jaipur market has lowest price volatility which is represented by 17.56 % compared to 41.10 % in Sri Ganganagar market, which has the highest. The co-integration tests result indicates Ganganagar” Alwar Ganganagar  Ajmer, Ludhiana  Jaipur, Ludhiana  Jodhpur, Ludhiana  Ajmer market pairs are not integrated in the long run. However, Ganganagar  Bikaner, Ganganagar  Delhi, Ganganagar  Jodhpur, Ganganagar  Ludhiana, Ganganagar  Jaipur and Ludhiana  Delhi are integrated in the long run. The results from the error correction model shows, there is short run unidirectional causality of Ganganagar  Bikaner and Ganganagar  Jodhpur. The lowest speed of adjustment towards long run equilibrium was from Ganganagar to Bikaner at rate of 0.2 percent. The speeds of adjustment running Ganganagar to Ludhiana and Ganganagar to Delhi markets towards long run equilibrium were 198 percent and 184 percent respectively in a period of 1 week at most. The speed of adjustment from Ganganagar to Jodhpur is 16.4 percent whereas Ganganagar to Jaipur is 10.4 %. The results shows there is no short run causality between the market pairs of Ganganagar  Alwar and Ludhiana  Jodhpur. On the other hand, the results show a unidirectional causality of some market pairs namely Ganganagar  Ajmer, Ludhiana  Jaipur and Ludhiana  Ajmer. The impulse response function shows that an unexpected shock in the prices of kinnow in Ganganagar will have a permanent lasting effect on prices of the various markets within a period of 4 weeks except Ajmer market prices.





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