Vertical Price Transmission of Milk Prices: Are Small Dairy Producers Efficiently Integrated Into Markets?
Version of Record online: 15 OCT 2013
© 2013 Wiley Periodicals, Inc.
Special Issue: Emerging Issues in Global Animal Product Trade
Volume 30, Issue 1, pages 56–63, Winter 2014
How to Cite
Acosta, A. and Valdés, A. (2014), Vertical Price Transmission of Milk Prices: Are Small Dairy Producers Efficiently Integrated Into Markets?. Agribusiness, 30: 56–63. doi: 10.1002/agr.21357
- Issue online: 10 JAN 2014
- Version of Record online: 15 OCT 2013
Vol. 30, Issue 2, 224, Version of Record online: 21 APR 2014
In recent years the dairy sector in Panama has experienced mergers and consolidations that have led to increases in industry concentration, a decrease in the number of producers, and an increase in the scale of operations. Small dairy producers have expressed concerns about the competitiveness of the dairy supply chain, arguing that price changes are not being transmitted efficiently from wholesalers to producer at the farm gate level. In this context, this study examines the degree of vertical price transmission between wholesalers and small dairy producers to assess the efficiency level of the dairy market chain in Panama. The findings of this research provide original and important contributions to the policy dialogue uncovering two key issues: 1) a unidirectional transmission of milk prices from producers to wholesaler, and 2) that the transmission of milk prices is asymmetric depending on whether prices are increasing or decreasing. [EconLit Classifications: Q11, Q13, Q18].