Regional Log Market Integration in New Zealand

In this paper the integration of log prices across four regions in New Zealand was assessed. A time series of prices for six radiata pine (Pinus radiata D. Don) log grades in each of the regions were tested for co-integration using Johansen’s method and Engle-Granger pair wise tests. Prices for export grades display significant integration across regions and generally follow the law of one price. However, markets for domestic grades tend to be regionally segregated. These results are most likely due to the high costs of transporting logs between regions. Future modelling will need to incorporate such transportation costs in order to adequately characterise log markets in the country.


Issue Date:
2008-02
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/37082
Total Pages:
31
JEL Codes:
Q23; R32
Series Statement:
REPA Working Paper
2008-03




 Record created 2017-04-01, last modified 2017-08-25

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