COMERCIAL LIBERALIZATION IN BRAZIL AND INTEGRATION IN THE MARKETS OF AGRICULTURAL COMMODITIES: THE COTTON, CORN AND RICE MARKETS
The objective of this work is to analyze the long-run relationship between series of prices in some of the main export markets and Brazilian prices for cotton, rice and com. Our aim is to verify if reductions in trade barriers favored by changes in the internal/ external commercial relationships, as well as in the internal commercial and sectorial politics, were adequate to integrate the considered markets, as established by the proposition of the Law of One Price. The technique of cointegration time series developed by Johansen (1988) was used to decompose the long-term relationships in terms of tests on the alpha parameters (adjustment coefficients) and beta (importance of each variable in the long term adjustment process). The obtained results were not uniform in the sense of offering support to the proposition of marketing integration. For the rice and com models, one cointegration vector was obtained. Relations of cointegration could be evidenced only between Argentina/ Rotterdam for the com model, and Bangkok/ Uruguay and Uruguay/ Brazil for the rice model. As for cotton no integration relationship was evidenced.
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