Market Integration in the EU Pork Market – Evidence from Panel ESTAR Models
Keywords:
spatial market integration, pork market, European Union, panel STAR modelsAbstract
Market integration is a key pre-condition for the efficient allocation of production factors and the maximization of economic welfare. Within this framework the aim of this research is to assess horizontal integration of the UE pork markets over time using panel models and weekly price series data. According to the spatial equilibrium model, market agents make trade decisions only when price differences exceed trade costs. Thus panel STAR models were used in this study. The obtained results confirmed nonlinear price adjustment in the EU pork markets. Price adjustments in central EU countries are stronger than in the peripheral countries and the strength of price convergence varies over time.
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