Exchange Rates Impacts on Agricultural Inputs Prices using VAR

The effects of the U.S. dollar exchange rate versus the Mexican peso are evaluated for four traded nonfarm-produced inputs (fertilizer, chemicals, farm machinery, and feed) in the U.S. Unit root tests suggest that the exchange rate and the four input price ratios support the presence of unit roots with a trend model but the presence unit roots can be rejected in the first difference model. This result is consistent with a fixed price/flex price conceptual framework, with industrial prices more likely to be unresponsive to the exchange rate than farm commodity prices.

Issue Date:
Aug 01 2009
Publication Type:
Journal Article
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Published in:
Journal of Agricultural and Applied Economics, Volume 41, Number 2
Page range:
JEL Codes:
F14; F31; F36; F42; C23

 Record created 2017-04-01, last modified 2018-01-22

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