Vertical price transmission in the Finnish food sector

In this study we estimated vertical price transmission in the Finnish food sector by using the Engle-Granger two-staged co-integration method. The results indicate that the producer price of beef and the consumer price of beef roast are co-integrated and that price transmission is quite effective. Liquid milk does not significantly differ from raw milk. However, the consumer price of liquid milk and the producer price of milk do not follow each other. The producer price and consumer prices of eggs are not co-integrated, either. A highly competitive market situation has existed on both egg and dairy markets during the 21st century.