Vertical Price Transmission of Perishable Products: The Case of Fresh Fruits in the Western United States

Abstract

This paper investigates the asymmetry of price transmission in the marketing chain of shipping points and terminal markets for fresh fruits in the western United States. To preserve the distinct price patterns related to product perishability, we use data constructed at a fine time scale and representing the vertical markets linked with shipments. Using a decade of weekly data, we estimate the autoregressive distributed lag price transmission model and derive the dynamic multiplier effects of price responses. Our results indicate that the price adjustments and asymmetry patterns are closely related to product characteristics, especially the intensity of product perishability.