Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market
The study estimates the contribution of changes in world prices, exchange rates, and trade policies in explaining the variability of domestic prices under the scenario of incomplete transmission of changes and a counterfactual scenario of complete pass-through. We utilize data from the Indian wheat...
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Cambridge University Press
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| Series: | Agricultural and Resource Economics Review |
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| author | Ashutosh K. Tripathi Ashok K. Mishra |
| author_facet | Ashutosh K. Tripathi Ashok K. Mishra |
| author_sort | Ashutosh K. Tripathi |
| collection | DOAJ |
| description | The study estimates the contribution of changes in world prices, exchange rates, and trade policies in explaining the variability of domestic prices under the scenario of incomplete transmission of changes and a counterfactual scenario of complete pass-through. We utilize data from the Indian wheat market for the period 2006–09 and 2017–20. The findings reveal an improvement in the pass-through of changes from the landed price to domestic markets. The price transmission elasticity increased from 50% in 2006/07–2008/09 to 67% during 2017/18–2019/20. The policy response to rising (declining) global prices of decreasing (increasing) import tariffs had a significant effect on prices. The variation in exchange rate offsets the impact of declining or rising global prices on domestic prices. |
| format | Article |
| id | doaj-art-389b97adaf2745e8910f2e6bf4424d81 |
| institution | OA Journals |
| issn | 1068-2805 2372-2614 |
| language | English |
| publisher | Cambridge University Press |
| record_format | Article |
| series | Agricultural and Resource Economics Review |
| spelling | doaj-art-389b97adaf2745e8910f2e6bf4424d812025-08-20T02:11:40ZengCambridge University PressAgricultural and Resource Economics Review1068-28052372-261411710.1017/age.2025.19Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat marketAshutosh K. Tripathi0https://orcid.org/0000-0002-8135-7989Ashok K. Mishra1https://orcid.org/0000-0002-0988-1428Indian Institute of Management (IIM)-Sambalpur, Sambalpur, Odisha, IndiaMorrison School of Agribusiness, W. P. Carey School of Business, Arizona State University, Mesa, AZ, USAThe study estimates the contribution of changes in world prices, exchange rates, and trade policies in explaining the variability of domestic prices under the scenario of incomplete transmission of changes and a counterfactual scenario of complete pass-through. We utilize data from the Indian wheat market for the period 2006–09 and 2017–20. The findings reveal an improvement in the pass-through of changes from the landed price to domestic markets. The price transmission elasticity increased from 50% in 2006/07–2008/09 to 67% during 2017/18–2019/20. The policy response to rising (declining) global prices of decreasing (increasing) import tariffs had a significant effect on prices. The variation in exchange rate offsets the impact of declining or rising global prices on domestic prices.https://www.cambridge.org/core/product/identifier/S106828052500019X/type/journal_articleAg-tradeagricultural policiesexchange ratesinfrastructureprice transmissionworld pricesD52F15P22Q11 |
| spellingShingle | Ashutosh K. Tripathi Ashok K. Mishra Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market Agricultural and Resource Economics Review Ag-trade agricultural policies exchange rates infrastructure price transmission world prices D52 F15 P22 Q11 |
| title | Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market |
| title_full | Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market |
| title_fullStr | Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market |
| title_full_unstemmed | Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market |
| title_short | Incomplete pass-through and variability in domestic prices: empirical evidence from the Indian wheat market |
| title_sort | incomplete pass through and variability in domestic prices empirical evidence from the indian wheat market |
| topic | Ag-trade agricultural policies exchange rates infrastructure price transmission world prices D52 F15 P22 Q11 |
| url | https://www.cambridge.org/core/product/identifier/S106828052500019X/type/journal_article |
| work_keys_str_mv | AT ashutoshktripathi incompletepassthroughandvariabilityindomesticpricesempiricalevidencefromtheindianwheatmarket AT ashokkmishra incompletepassthroughandvariabilityindomesticpricesempiricalevidencefromtheindianwheatmarket |