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Abstract
At this study we analyze horizontal cross-commodity price transmission and integration of the EU
livestock market of pork and beef. The study seeks to investigate whether or not there are long-term and
short-term relationships between pork and beef prices in the EU. Our focus is on cross-commodity price
transmission which provides valuable insights into market integration and efficiency. We utilize recently
developed panel time-series techniques. Our data consists of monthly data on pork and beef prices in the EU
member states during the period from February 1995 to June 2014. The estimation results reveal that there
exists bi-directional relationship between pork and beef prices in the EU in long run. Cross-commodity price
transmission between pork and beef has increased remarkably during the past ten years in the EU15 member
states. Also the convergence to the equilibrium has sped up. In short run, we found evidence only for price
transmission from pork prices to beef prices, not vice versa. Overall, short-run dynamics is significantly
different in the EU livestock market compared to long run dynamics.