The spatial integration of potato wholesale markets of Uttarakhand in India

A Kumar,R Mishra

doi:10.3329/sja.v14i2.31242

Abstract

This paper analyzes the spatial integration of potato markets in Uttarakhand using monthly wholesale price for ten years. The maximum likelihood method of cointegration developed by Johansen (1988) was used in the study. The dynamics of short-run price responses were examined using vector error correction model (VECM). The results indicated that five potato markets reacted on the long-run cointegrating equations while the speed of price adjustment in the short-run was almost absent. Moreover, it was found that the longer the distance between the markets, the weaker the integration was. To increase the efficiency of potato markets in Uttarakhand, there is need to focus on building an improved market information system. This system should be able to disseminate timely market information about price, demand and supply of produce to enable producers, traders and consumers to make proper production and marketing decisions.SAARC J. Agri., 14(2): 20-30 (2016)

Highlights

The nature of markets and their role in price determination are central to economies
The present study analyzes the spatial integration of potato wholesale markets in the Uttarakhand state by using recently developed cointegration techniques
The estimated test statistics from Augmented Dickey-Fuller (ADF) tests for wholesale prices of potato in levels and first differences are reported in table 1

Summary

Introduction

The nature of markets and their role in price determination are central to economies. The present study was carried out to examine the spatial price relationship of potato in different wholesale markets of Uttarakhand. The present study analyzes the spatial integration of potato wholesale markets in the Uttarakhand state by using recently developed cointegration techniques. The integration of potato markets of Uttarakhand was evaluated by investigating the long-run relationship between the wholesale price series of potato in spatially separated locations of Uttarakhand.

Results

Conclusion