Spatial Market Integration between Two Markets of Sorghum in Karnataka and Maharashtra State of India

Abstract

The study examined the spatial price behaviour, which is an important indicator of
the overall market performance. Markets that are not integrated may convey inaccurate price
signals that might distort producers’ marketing decisions and contribute to inefficient
product movements. Secondary data was used for the study obtained from Agmarknet.com
based on the frequent arrivals, two district were selected from Karnataka and Maharashtra
states (ie Bangalore and Sholapur respectively) using the modal prices from January 2003 to
May 2015.The results revealed that after the first differencing the Augmented- Dickey Fuller
(ADF) test the series is non stationary and co-integrated, with Bangalore market influencing
Sholapur market in the long run.