The geographical separation of markets is of a special importance in agriculture, as often, agricultural products are bulky and/or perishable, and the place of consumption may be different from that of production, implying possibly expensive transport costs (SEXTON ET AL., 1991). The imperfectly integrated markets may send wrong price information signals to producers and other actors of the marketing chain, resulting incorrect production and marketing decisions. The aim of the article is to map the horizontal integration on the milk market in the Hungarian milk market using up-to-date Vector Error Correction (VECM) and Threshold Error Correction (TEVCM) methods.


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