MARKET INTEGRATION TEST FOR PACIFIC EGG MARKETS

This paper uses of Johansen's multivariate cointegration test to test for egg market integration of six Pacific states, Washington, Idaho, Oregon, California, Nevada, and Arizona. We conclude that eggs from these states substitute for each other to some degree, and arbitrage possibilities through trade bind the egg prices. In addition, the Law of One Price (LOP), the case of perfect integration, is examined by testing the linear combination of cointegration vectors. Test results show that the LOP is not satisfied even though the egg markets in the six Pacific states are highly integrated. Arizona egg prices, California egg prices, and Washington egg prices play dominant roles on the Pacific egg market in the long run.


Issue Date:
2003
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/21934
Total Pages:
19
Series Statement:
Selected Paper




 Record created 2017-04-01, last modified 2017-08-24

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