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Market integration of the Malaysian poultry industry: a bound testing approach to co-integration

This paper examines market integration by analyzing transmission of price among spatially separated regional wholesale poultry markets in Peninsular Malaysia. Short-run and long-run relationship of wholesale price among regional markets was examined using bound testing approach to co-integration and...

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Main Authors: Muazu, Abdulrazak Umar, Mohamed, Zainal Abidin, Shamsudin, Mad Nasir, Abd. Latif, Ismail
Format: Article
Language:English
Published: Meghana Publications 2013
Online Access:http://psasir.upm.edu.my/id/eprint/29357/1/Market%20integration%20of%20the%20Malaysian%20poultry%20industry%20a%20bound%20testing%20approach%20to%20co-integration.pdf
http://psasir.upm.edu.my/id/eprint/29357/
http://www.ijasvm.com/previousissue.php?year=2013&issue=3
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spelling my.upm.eprints.293572016-07-13T02:10:35Z http://psasir.upm.edu.my/id/eprint/29357/ Market integration of the Malaysian poultry industry: a bound testing approach to co-integration Muazu, Abdulrazak Umar Mohamed, Zainal Abidin Shamsudin, Mad Nasir Abd. Latif, Ismail This paper examines market integration by analyzing transmission of price among spatially separated regional wholesale poultry markets in Peninsular Malaysia. Short-run and long-run relationship of wholesale price among regional markets was examined using bound testing approach to co-integration and error correction models. The statistics follows the procedure of Wald or F-statistics in a generalized Dickey-Fuller regression, which is used to test the significance of lagged levels of the variables in a conditional unrestricted Equilibrium Correction Model (ECM). Based on Wald or F-test results of the jointly lag wholesale regional market prices, there exist co-integration among the price series. The value of the F-statistics (4.176) is greater than the upper bound critical values (3.67) at 5% significance level and also significant. Therefore, a long-run equilibrium relationship was found to exist between the regional markets. Results of the pair-wise Granger-causality between regional wholesale markets indicate bidirectional causality between central as terminal market and East-coast market. There is unidirectional South region Granger-cause central wholesale market price like-wise North region market Granger-cause Central market but not on the other direction. Meghana Publications 2013-08 Article PeerReviewed application/pdf en http://psasir.upm.edu.my/id/eprint/29357/1/Market%20integration%20of%20the%20Malaysian%20poultry%20industry%20a%20bound%20testing%20approach%20to%20co-integration.pdf Muazu, Abdulrazak Umar and Mohamed, Zainal Abidin and Shamsudin, Mad Nasir and Abd. Latif, Ismail (2013) Market integration of the Malaysian poultry industry: a bound testing approach to co-integration. International Journal of Agricultural Sciences and Veterinary Medicine, 1 (3). pp. 47-58. ISSN 2320-3730 http://www.ijasvm.com/previousissue.php?year=2013&issue=3
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
language English
description This paper examines market integration by analyzing transmission of price among spatially separated regional wholesale poultry markets in Peninsular Malaysia. Short-run and long-run relationship of wholesale price among regional markets was examined using bound testing approach to co-integration and error correction models. The statistics follows the procedure of Wald or F-statistics in a generalized Dickey-Fuller regression, which is used to test the significance of lagged levels of the variables in a conditional unrestricted Equilibrium Correction Model (ECM). Based on Wald or F-test results of the jointly lag wholesale regional market prices, there exist co-integration among the price series. The value of the F-statistics (4.176) is greater than the upper bound critical values (3.67) at 5% significance level and also significant. Therefore, a long-run equilibrium relationship was found to exist between the regional markets. Results of the pair-wise Granger-causality between regional wholesale markets indicate bidirectional causality between central as terminal market and East-coast market. There is unidirectional South region Granger-cause central wholesale market price like-wise North region market Granger-cause Central market but not on the other direction.
format Article
author Muazu, Abdulrazak Umar
Mohamed, Zainal Abidin
Shamsudin, Mad Nasir
Abd. Latif, Ismail
spellingShingle Muazu, Abdulrazak Umar
Mohamed, Zainal Abidin
Shamsudin, Mad Nasir
Abd. Latif, Ismail
Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
author_facet Muazu, Abdulrazak Umar
Mohamed, Zainal Abidin
Shamsudin, Mad Nasir
Abd. Latif, Ismail
author_sort Muazu, Abdulrazak Umar
title Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
title_short Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
title_full Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
title_fullStr Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
title_full_unstemmed Market integration of the Malaysian poultry industry: a bound testing approach to co-integration
title_sort market integration of the malaysian poultry industry: a bound testing approach to co-integration
publisher Meghana Publications
publishDate 2013
url http://psasir.upm.edu.my/id/eprint/29357/1/Market%20integration%20of%20the%20Malaysian%20poultry%20industry%20a%20bound%20testing%20approach%20to%20co-integration.pdf
http://psasir.upm.edu.my/id/eprint/29357/
http://www.ijasvm.com/previousissue.php?year=2013&issue=3
_version_ 1643829736314503168
score 13.211869

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