Journal of Forest Economics > Vol 19 > Issue 1

Asymmetric transmission between factory and wholesale prices in fiberboard market in Korea

Byeong-Il Ahn, , ahn08@korea.ac.kr Hyunok Lee, , hyunok@primal.ucdavis.edu
 
Suggested Citation
Byeong-Il Ahn and Hyunok Lee (2013), "Asymmetric transmission between factory and wholesale prices in fiberboard market in Korea", Journal of Forest Economics: Vol. 19: No. 1, pp 1-14. http://dx.doi.org/10.1016/j.jfe.2012.06.008

Published: 0/1/2013
© 0 2013 Byeong-Il Ahn, Hyunok Lee
 
Subjects
 
Keywords
JEL Codes:D49L73
Price relationshipsAsymmetric transmissionFiberboardCausalityCo-integrationMarketing chain
 

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In this article:
Introduction
Empirical models
Data
Preliminary tests
Estimation results of asymmetric price transmission
Summary and implications

Abstract

This paper extends the estimation of price relationships in wood processing and empirical assessment of asymmetric price transmission by incorporating time lags in both explanatory and dependent variables. Each of the models developed and estimated in this article reveals the existence of asymmetric price transmission between factory and wholesale prices of fiberboard in Korea. Estimation results indicate that wholesalers earn additional profits by exploiting price fluctuations in the markets. The empirical findings in this study suggest the potential for lower wholesale prices of fiberboard with more competition in wholesale marketing.

DOI:10.1016/j.jfe.2012.06.008