| The price stability of vegetables has an important impact on people’s livelihood and effective transmission of vegetable prices have an important impact on the interests of producers and consumers. This paper selects two kinds of vegetables, tomato and white lotus to implement an empirical study on Jingyang vegetable production price and retailing price fluctuation and conduction. Firstly, a statistical test was taken on data obtained by field survey, and results showed that the distributions of the production and retailing prices data of both tomato and white lotus meet the normal distribution and meet the randomness that sample data supposed to have.Descriptive analysis found the correlation between tomato and white lotus retailing and production price. Sequence diagrams analysis found price fluctuation has periodicity, seasonality and clustering; and then econometric models were used to study the fluctuation of four groups of time series. HP filtering method was used after seasonal adjustment and inflation elimination, finding the periodicity of tomatoes and white lotus prices and getting the average fluctuation period. Clustering was found by GARCH model both in tomato and white lotus prices’ fluctuation; then the reason why periodicity and clustering exist was analyzed and explained by aspects including vegetables’ seasonality, perishability, periodicity of demand, market completion, resilience, serve and selling. The study on price conduction was done by establishing asymmetric error correction model. Granger causality test was used to test the causality between production and retailing prices on condition that prices data were testified to be stationary time series. Tomato retailing price effects production price while for the white lotus, vice versa. VAR model was established to test the relation between retailing and production prices, and both lag period and model were identified. Then price conduction effect was analyzed by impulse response and variance decomposition. The variance decomposition of tomato showed that tomato retailing price change was mainly due to past retailing price change, with the production price change a combined result of past retailing and production price change. The white lotus variance decomposition presented that white lotus retailing price change was mainly due to past retailing prices; white lotus production price change was mainly due to past production price. Impulse response and variance decomposition presented that tomato and white lotus retailing and production price fluctuation have asymmetry. Then cointegration test was used to test the relation of price fluctuation in the long run, and cointegration reflected long term equilibrium in the two prices. At last, asymmetric error correction model was used and analyzed that price conduction has asymmetry.The conduction from tomato production price to retailing price had asymmetry, while the negative impact from retailing price to production price was more allergic. The effect on tomato retailing price by production price was asymmetric, as the positive impact from production price to retailing price was more allergic. The conduction from white lotus production price to retailing price had asymmetry,too. The negative effect by production price led to stronger reaction in retailing price. The conduction from retailing price to production price was also asymmetric, as positive effect by retailing price led to stronger reaction in production price. The stability of vegetable price has an important impact on people’s livelihood. The fluctuation and asymmetric conduction of vegetable price was due to a combined effect by all procedures of industry chain.At last, the paper gave advice in the view of planters, intermediaries, retailers and government. Advice include balancing strengths of all circulation procedures, improving negotiating producers’ negotiating ability, deducing information asymmetry in vegetable circulation, perfecting market structure and enhancing government’s macro-control. |
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