Econometric analysis reveals cointegration and nonlinear threshold price adjustments in wholesale apple markets, indicating a need for improved infrastructure.
Key Points
To evaluate spatial market integration, dynamic price transmission, and nonlinear threshold adjustments across major wholesale apple markets in India.
Analyzed monthly wholesale apple price time-series using cointegration tests and the Granger causality framework.
Modeled dynamic price shocks and adjustment speeds toward long-run equilibrium using Generalized Impulse Response Functions, Vector Error Correction Models (VECM), and Threshold Vector Error Correction Models (TVECM).
Wholesale apple markets demonstrated long-run cointegration, with Jammu and Mumbai acting as dominant price leaders displaying bidirectional causality with regional markets.
Regional markets (Delhi, Hyderabad, Kanpur, Ludhiana) adjusted toward central market prices, with TVECM demonstrating faster adjustments than standard linear models and confirming nonlinear threshold dynamics.