An analysis of market integration in the pig marketing system in Thailand : 1969-1979

Abstract

This study describes the pig and pork marketing system in Thailand and attempts to choose an appropriate technique to analyse pig market integration for the period 1969-1979. Many economists who have studied agricultural markets in low income countries have concluded that the marketing systems in those countries are relatively inefficient, whereas anthropologists often conclude the opposite. This study attempts to show how the concept of market integration is useful and can be a proxy to indicate market efficiency especially in low income countries. Because of the unavailability and unreliability of data and the existence of parallel informal and illegal markets, correlation analysis using prices series data only is used in this analysis instead of regression/margins analysis which is normally used in high income countries. Regression analysis was at first used to investigate market integration but was rejected due to the need to specify the direction of causal relationship and because of multicollinearity problems. Absolute and first difference values of price data were then analysed using correlation analysis. Owing to biases caused by trend and seasonal influences in those values, this method was also rejected and the residual value from which the trend and seasonal influences have been removed was then used. Government intervention caused a structural change in the market during the study period. The 'unrestricted area' period and the 'restricted area' period were therefore analysed separately. Show more