1Department of Economics and Sociology, College of Basic Sciences and Humanities, Punjab Agricultural University, Ludhiana, 141004, Punjab, India
2Department of Agricultural Economics, Dr. Yashwant Singh Parmar University of Horticulture and Forestry, Solan, 173230, Himachal Pradesh, India
Online published on 13 December, 2019.
This paper analyses the transmission and spatial integration between tomato-producing markets (Solan and Ludhiana) and tomato-consuming markets (Chandigarh and Delhi) using monthly price data from April 2005 to March 2019. We used correlation analysis, the Johansen cointegration test, the vector error correction model and the Granger causality test. Instability in the price series was measured by the Cudda Della-Valle index. The maximum instability in tomato prices was in November (50–59%), and the seasonality index showed that farmers received more than the average price from August to November. The Johansen cointegration test revealed that all the selected markets were well integrated in the long run. The low root mean square error (RMSE) and the mean absolute percentage error (MAPE) reinforce the high forecasting ability of the fitted model.
