Analysis of Market Integration: A Case of Sugar in Selected Markets in Kenya

Market integration is one of the most important aspects that can be used to assess the impacts of market development and liberalization policies. In the study areas, there was thin knowledge whether the sugar markets were integrated or segmented. Therefore, this paper seeks to determine the existence of integration among the selected sugar markets. Secondary data was obtained for average monthly prices of sugar from January 2008 to December 2012. Data was analyzed using Co-integration model. The result revealed that road networks, communication networks, consumers’ purchasing power and the distance between the markets greatly influenced market integration. Based on the findings the policy implication was drawn to enhance sugar market integration in the study areas. Key words: Co-integration model, market integration, selected market

Testing for Cointegration and Granger Causality: Evidence from Selected Indigenous Egg Markets in Kenya

Despite the increasing consumer demand for indigenous eggs, particularly among the urban rich in Kenya, empirical analysis of spatial market integration has received limited attention. This study is an attempt to analyze the existence of market integration and price transmission among four selected indigenous egg markets. The study uses secondary data obtained on prices of eggs on a weekly basis during the year 2014. Analysis of Cointegration and Granger causality was attained using Johansen cointegration approach. Interestingly, results indicate integration in the indigenous eggs markets in Kenya. While prices of eggs in Kisumu and Eldoret towns Granger-caused each other, there was no evidence to account for price interactions among the rest of the markets. These findings strongly indicate asymmetric price transmission within the markets. Taking advantage of the promising niche provided by indigenous eggs requires policies aimed at unlocking information asymmetry as well as promoting market access among farmers. Key words: Market integration, Granger causality, indigenous eggs, Keny