Authors: Dimitris Pachis, George Peppas, Augustinos Dimitras

Title: Price Analysis in the European Food Supply Chain

Abstract

Our study examines the effect of price transmission mechanisms on the effectiveness of the food supply chain. The analysis focuses on the European food supply chain and the main food categories of cereals, meat and fats. The price transmission mechanism between producers and consumers is examined based on the price indices provided by the food monitoring tool of the European Statistical Agency. The time series span from January of 1995 to December of 2019. The price mechanism is examined via the Vector AutoRegressive (VAR) model and its variants. The price series are tested for stationarity and the appropriate model is fitted followed by Granger Causality tests, Impulse Responses and Forecasts of Error Decomposition. The results give insights to the degree of monopolistic power exerted by producer and consumer in the food supply chains. The results are utilized for the assessment of the effectiveness of the supply chain in the notion of fair allocation of resources between producers and consumers and the management activities that can be adopted to improve it.