Nonlinearities in the Slovenian apple price transmission

What is it about?

This paper examines price transmission among producer and consumer markets for apple in Slovenia using nonlinear vector error correction models, i.e. threshold vector error correction model and multivariate local linear regression estimation techniques. Monthly prices of the period 2000-2011 are used in the empirical estimation. Findings suggest that producer and consumer prices tend to increase rather than decrease.

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Why is it important?

It is the first paper that assess vertical price transmission in the apple sector in Central and Eastern European Country markets. Further, it is the first attempt to use multivariate local linear regression techniques in this context.