MARKET PRICE COINTEGRATION OF TOMATO: EFFECTS TO NEPALESE FARMERS

Market price cointegration is a critical issue in Nepalese vegetable industry. This study intended to analyze the market price cointegration of tomato and its effect on Nepalese farmers, using secondary monthly time series of wholesale price data (since 2000 to 2010) of the Government of Nepal. The results of error correction model (ECM) showed that the series were stationary, and Kathmandu market was well cointegrated with source markets (Chitwan and Morang). Meanwhile, the vector error correction model (VECM) revealed that price adjustment process was much faster in source markets especially in negative price shocks in response to Kathmandu market, which affected the farmers for speedy price adjustment that leads to be hurt and discouraged. The study recommend policies to establish alternative vegetable markets that reduce the price dependency of farmers on Kathmandu market, encourage traders in involving vegetable marketing, and enhance effective market information services.


Issue Date:
2014-04
Publication Type:
Journal Article
DOI and Other Identifiers:
ISSN: 2147-8988 (Other)
PURL Identifier:
http://purl.umn.edu/168582
Published in:
International Journal of Food and Agricultural Economics, Volume 02, Number 2
Page range:
87-96
Total Pages:
10
Series Statement:
Vol 2
No 2




 Record created 2017-04-01, last modified 2017-04-28

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