Who wins in the rice trade? Asymmetric information and price transmission in Indonesia’s rice market
DOI:
https://doi.org/10.35588/6pann874Keywords:
rice, agricultural marketing, price policyAbstract
This study examines how rice prices are passed from farmers to other marketing agencies. This study uses monthly data on rice prices at the producer (farmer), rice miller, and wholesaler levels from 2010 to 2024 in Indonesia. Meanwhile, the method used in this study is Error Correction Model regression. The findings indicate the presence of market integration and asymmetry in the vertical transmission of rice prices between farmers and other marketing agencies, both in the short and long term. Asymmetric price transmission results from market power abuse and adjustment costs. The government must monitor rice prices, ensure fair trade, detect irregularities, and encourage increased participation in rice markets.
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