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Empirical investigation into spatial integration without direct trade : comparative analysis before and after the establishment of the Ethiopian Commodity Exchange

Tinsae Demise Handino, Valéri Natanelov, Wim Verbeke UGent and Marijke D'Haese UGent (2017) JOURNAL OF DEVELOPMENT STUDIES. 53(4). p.565-583
abstract
This paper presents a comparative analysis of the spatial price cointegration of coffee markets in Ethiopia in the pre and post Ethiopian Commodity Exchange (ECX) era using the autoregressive distributed lag (ARDL) cointegration framework. The study takes into consideration a market condition in which government policy restricts arbitrage coffee trade between coffee producing areas. Using coffee price data from 1998-2013 and applying a bounds test approach and Toda-Yamamoto Granger causality test, the study finds that the establishment of ECX has strengthened regional integration rather than a national harmony between producer markets. We also find evidence that, since the establishment of ECX, an opportunity was created for high quality coffee to dominate price formation while also allowing lower quality coffee producing areas to establish themselves. The study underlines the importance of market transparency and exchange of price information between producer markets.
Please use this url to cite or link to this publication:
author
organization
year
type
journalArticle (original)
publication status
published
subject
keyword
TESTING MARKET INTEGRATION, RICE MARKET, PRICE TRANSMISSION, COINTEGRATION, EQUILIBRIUM, LIBERALIZATION, INVESTMENT, EXTENT, CHINA
journal title
JOURNAL OF DEVELOPMENT STUDIES
J. Dev. Stud.
volume
53
issue
4
pages
565 - 583
Web of Science type
Article
Web of Science id
000396821100007
ISSN
0022-0388
DOI
10.1080/00220388.2016.1187722
language
English
UGent publication?
yes
classification
A1
copyright statement
I have transferred the copyright for this publication to the publisher
id
8500665
handle
http://hdl.handle.net/1854/LU-8500665
date created
2017-01-09 09:28:47
date last changed
2017-04-05 11:22:32
@article{8500665,
  abstract     = {This paper presents a comparative analysis of the spatial price cointegration of coffee markets in Ethiopia in the pre and post Ethiopian Commodity Exchange (ECX) era using the autoregressive distributed lag (ARDL) cointegration framework. The study takes into consideration a market condition in which government policy restricts arbitrage coffee trade between coffee producing areas. Using coffee price data from 1998-2013 and applying a bounds test approach and Toda-Yamamoto Granger causality test, the study finds that the establishment of ECX has strengthened regional integration rather than a national harmony between producer markets. We also find evidence that, since the establishment of ECX, an opportunity was created for high quality coffee to dominate price formation while also allowing lower quality coffee producing areas to establish themselves. The study underlines the importance of market transparency and exchange of price information between producer markets.},
  author       = {Handino, Tinsae Demise and Natanelov, Val{\'e}ri and Verbeke, Wim and D'Haese, Marijke},
  issn         = {0022-0388},
  journal      = {JOURNAL OF DEVELOPMENT STUDIES},
  keyword      = {TESTING MARKET INTEGRATION,RICE MARKET,PRICE TRANSMISSION,COINTEGRATION,EQUILIBRIUM,LIBERALIZATION,INVESTMENT,EXTENT,CHINA},
  language     = {eng},
  number       = {4},
  pages        = {565--583},
  title        = {Empirical investigation into spatial integration without direct trade : comparative analysis before and after the establishment of the Ethiopian Commodity Exchange},
  url          = {http://dx.doi.org/10.1080/00220388.2016.1187722},
  volume       = {53},
  year         = {2017},
}

Chicago
Handino, Tinsae Demise, Valéri Natanelov, Wim Verbeke, and Marijke D’Haese. 2017. “Empirical Investigation into Spatial Integration Without Direct Trade : Comparative Analysis Before and After the Establishment of the Ethiopian Commodity Exchange.” Journal of Development Studies 53 (4): 565–583.
APA
Handino, T. D., Natanelov, V., Verbeke, W., & D’Haese, M. (2017). Empirical investigation into spatial integration without direct trade : comparative analysis before and after the establishment of the Ethiopian Commodity Exchange. JOURNAL OF DEVELOPMENT STUDIES, 53(4), 565–583.
Vancouver
1.
Handino TD, Natanelov V, Verbeke W, D’Haese M. Empirical investigation into spatial integration without direct trade : comparative analysis before and after the establishment of the Ethiopian Commodity Exchange. JOURNAL OF DEVELOPMENT STUDIES. 2017;53(4):565–83.
MLA
Handino, Tinsae Demise, Valéri Natanelov, Wim Verbeke, et al. “Empirical Investigation into Spatial Integration Without Direct Trade : Comparative Analysis Before and After the Establishment of the Ethiopian Commodity Exchange.” JOURNAL OF DEVELOPMENT STUDIES 53.4 (2017): 565–583. Print.