4.3 Article

Price transmission asymmetry of selected fishes in Bangladesh: An econometric and value chain analysis

Journal

AQUACULTURE ECONOMICS & MANAGEMENT
Volume -, Issue -, Pages -

Publisher

TAYLOR & FRANCIS INC
DOI: 10.1080/13657305.2022.2163720

Keywords

Causality test; fish market integration; price transmission; statistical modeling; value chain

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Learning the extent of price volatility is crucial for the economic welfare of producers and consumers. In this study, we examined the price transmission relationship among the farmgate, wholesale, and retail markets for major aquaculture products in Bangladesh. The results suggest that the retail price leads the wholesale and farmgate price, and the price transmission pattern could be both symmetric and asymmetric in the long run. These findings provide important insights into the dynamics of price transmission in the aquaculture industry.
Learning the extent of price volatility is critical to ensure the producer and consumer's economic welfare. Hence, we have envisioned assessing the price transmission relationship over time among the farmgate, wholesale, and retail markets for the four major aquaculture products, namely Rui, Catla, Tilapia and Pangas in Bangladesh. The Granger causality test examined the causal relationships among the farmgate, wholesale and retail fish prices. The Houck/Ward and error correction approach was also applied to study their price transmission pattern. Results indicate that the retail price leads the wholesale and farmgate price. In most cases, the coefficient of variation decreases as the fish handover from the farmgate to retail levels. Out of 15 pairs of farmgate, wholesale, and retail price-series analyzed, 14 pairs are co-integrated (p < 0.01). Current results also suggest that the price transmission pattern is symmetric in the short run but could be a mixture of symmetric and asymmetric in the long run. This asymmetric price behavior indicates that changes in retail prices do not get reflected fully at both farmgate and wholesale prices, and the transmitted prices may vary according to the retail prices based on their rising or falling pattern.

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