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Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia

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@article{IJASEIT9667,
   author = {Rudi Wibowo and Ahmad Zainuddin and Rena Yunita Rahman and Intan Kartika Setyawati and Illia Seldon Magfiroh and Indah Ibanah},
   title = {Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia},
   journal = {International Journal on Advanced Science, Engineering and Information Technology},
   volume = {11},
   number = {3},
   year = {2021},
   pages = {874--879},
   keywords = {Co-integration; efficiency; cattle farmers; VECM.},
   abstract = {

Normatively, price changes that occur in the consumer market will be passed on to the producer’s market. The price change is not necessarily enjoyed by beef cattle farmers in Indonesia. The purpose of this research was to examine whether there is a vertical market integration of beef among consumer and producer market in Indonesia. The examination of this issue was done through the Vector Error Correction Model (VECM). The data used in this study were secondary. This study used monthly price data of beef (Rp/kg) in Indonesia, consisting of 96 observations from January 2011 to December 2018. This study reveals that there is a long-term relationship among the consumer market and producer market in Indonesia. The short-run was also found that vertical beef market integration in Indonesia is only one direction, from consumers to producers. This finding represents that the beef market is vertically integrated, but the integration is not perfect. Imperfect integration of beef marketing in Indonesia signifies that the beef market in Indonesia is inefficient both in the short and long term. This study recommends the government formulate policies that provide infrastructure to avoid market exploitation and asymmetry information from the consumer market to the producer market. Besides, the government needs a price brand policy, where the government sets a reasonable price disparity between prices at the farm level and prices at the consumer level.

},    issn = {2088-5334},    publisher = {INSIGHT - Indonesian Society for Knowledge and Human Development},    url = {http://ijaseit.insightsociety.org/index.php?option=com_content&view=article&id=9&Itemid=1&article_id=9667},    doi = {10.18517/ijaseit.11.3.9667} }

EndNote

%A Wibowo, Rudi
%A Zainuddin, Ahmad
%A Rahman, Rena Yunita
%A Setyawati, Intan Kartika
%A Magfiroh, Illia Seldon
%A Ibanah, Indah
%D 2021
%T Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia
%B 2021
%9 Co-integration; efficiency; cattle farmers; VECM.
%! Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia
%K Co-integration; efficiency; cattle farmers; VECM.
%X 

Normatively, price changes that occur in the consumer market will be passed on to the producer’s market. The price change is not necessarily enjoyed by beef cattle farmers in Indonesia. The purpose of this research was to examine whether there is a vertical market integration of beef among consumer and producer market in Indonesia. The examination of this issue was done through the Vector Error Correction Model (VECM). The data used in this study were secondary. This study used monthly price data of beef (Rp/kg) in Indonesia, consisting of 96 observations from January 2011 to December 2018. This study reveals that there is a long-term relationship among the consumer market and producer market in Indonesia. The short-run was also found that vertical beef market integration in Indonesia is only one direction, from consumers to producers. This finding represents that the beef market is vertically integrated, but the integration is not perfect. Imperfect integration of beef marketing in Indonesia signifies that the beef market in Indonesia is inefficient both in the short and long term. This study recommends the government formulate policies that provide infrastructure to avoid market exploitation and asymmetry information from the consumer market to the producer market. Besides, the government needs a price brand policy, where the government sets a reasonable price disparity between prices at the farm level and prices at the consumer level.

%U http://ijaseit.insightsociety.org/index.php?option=com_content&view=article&id=9&Itemid=1&article_id=9667 %R doi:10.18517/ijaseit.11.3.9667 %J International Journal on Advanced Science, Engineering and Information Technology %V 11 %N 3 %@ 2088-5334

IEEE

Rudi Wibowo,Ahmad Zainuddin,Rena Yunita Rahman,Intan Kartika Setyawati,Illia Seldon Magfiroh and Indah Ibanah,"Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia," International Journal on Advanced Science, Engineering and Information Technology, vol. 11, no. 3, pp. 874-879, 2021. [Online]. Available: http://dx.doi.org/10.18517/ijaseit.11.3.9667.

RefMan/ProCite (RIS)

TY  - JOUR
AU  - Wibowo, Rudi
AU  - Zainuddin, Ahmad
AU  - Rahman, Rena Yunita
AU  - Setyawati, Intan Kartika
AU  - Magfiroh, Illia Seldon
AU  - Ibanah, Indah
PY  - 2021
TI  - Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia
JF  - International Journal on Advanced Science, Engineering and Information Technology; Vol. 11 (2021) No. 3
Y2  - 2021
SP  - 874
EP  - 879
SN  - 2088-5334
PB  - INSIGHT - Indonesian Society for Knowledge and Human Development
KW  - Co-integration; efficiency; cattle farmers; VECM.
N2  - 

Normatively, price changes that occur in the consumer market will be passed on to the producer’s market. The price change is not necessarily enjoyed by beef cattle farmers in Indonesia. The purpose of this research was to examine whether there is a vertical market integration of beef among consumer and producer market in Indonesia. The examination of this issue was done through the Vector Error Correction Model (VECM). The data used in this study were secondary. This study used monthly price data of beef (Rp/kg) in Indonesia, consisting of 96 observations from January 2011 to December 2018. This study reveals that there is a long-term relationship among the consumer market and producer market in Indonesia. The short-run was also found that vertical beef market integration in Indonesia is only one direction, from consumers to producers. This finding represents that the beef market is vertically integrated, but the integration is not perfect. Imperfect integration of beef marketing in Indonesia signifies that the beef market in Indonesia is inefficient both in the short and long term. This study recommends the government formulate policies that provide infrastructure to avoid market exploitation and asymmetry information from the consumer market to the producer market. Besides, the government needs a price brand policy, where the government sets a reasonable price disparity between prices at the farm level and prices at the consumer level.

UR - http://ijaseit.insightsociety.org/index.php?option=com_content&view=article&id=9&Itemid=1&article_id=9667 DO - 10.18517/ijaseit.11.3.9667

RefWorks

RT Journal Article
ID 9667
A1 Wibowo, Rudi
A1 Zainuddin, Ahmad
A1 Rahman, Rena Yunita
A1 Setyawati, Intan Kartika
A1 Magfiroh, Illia Seldon
A1 Ibanah, Indah
T1 Vertical Market Integration for Beef Prices Using Vector Error Correction Model (VECM) In Indonesia
JF International Journal on Advanced Science, Engineering and Information Technology
VO 11
IS 3
YR 2021
SP 874
OP 879
SN 2088-5334
PB INSIGHT - Indonesian Society for Knowledge and Human Development
K1 Co-integration; efficiency; cattle farmers; VECM.
AB 

Normatively, price changes that occur in the consumer market will be passed on to the producer’s market. The price change is not necessarily enjoyed by beef cattle farmers in Indonesia. The purpose of this research was to examine whether there is a vertical market integration of beef among consumer and producer market in Indonesia. The examination of this issue was done through the Vector Error Correction Model (VECM). The data used in this study were secondary. This study used monthly price data of beef (Rp/kg) in Indonesia, consisting of 96 observations from January 2011 to December 2018. This study reveals that there is a long-term relationship among the consumer market and producer market in Indonesia. The short-run was also found that vertical beef market integration in Indonesia is only one direction, from consumers to producers. This finding represents that the beef market is vertically integrated, but the integration is not perfect. Imperfect integration of beef marketing in Indonesia signifies that the beef market in Indonesia is inefficient both in the short and long term. This study recommends the government formulate policies that provide infrastructure to avoid market exploitation and asymmetry information from the consumer market to the producer market. Besides, the government needs a price brand policy, where the government sets a reasonable price disparity between prices at the farm level and prices at the consumer level.

LK http://ijaseit.insightsociety.org/index.php?option=com_content&view=article&id=9&Itemid=1&article_id=9667 DO - 10.18517/ijaseit.11.3.9667