The Curious Relationship Between Agricultural and Energy Price Index: A Vector Error Correction Model (VECM) Analysis Approach

Journal of Administrative and Business Studies JABS 2019, 5(3): 161-177

17 Pages Posted: 12 Feb 2021

See all articles by Vicente E. Montaño

Vicente E. Montaño

University of Mindanao

Rosalia Gabronino

College of Business Education

Restie E. Torres

University of Mindanao

Date Written: June 28, 2019

Abstract

The primary purpose of this study is to examine the relationship between monthly energy and agriculture price indices. The research uses the Vector Error Correction Model (VECM) methods, taking into account the cointegrating relationship among the series monthly observation from October 1973 to October 2018. Contrary to the findings of earlier studies the empirical result of this research indicates that the oil price index responds to the equilibrium between agriculture and oil, and that is the agricultural price index affects the energy price index and not the other way around. Furthermore, this study presented a window of opportunity to examine the curious relationship between energy and agriculture prices closely.

Suggested Citation

Montaño, Vicente E. and Gabronino, Rosalia and Torres, Restie E., The Curious Relationship Between Agricultural and Energy Price Index: A Vector Error Correction Model (VECM) Analysis Approach (June 28, 2019). Journal of Administrative and Business Studies JABS 2019, 5(3): 161-177 , Available at SSRN: https://ssrn.com/abstract=3744014

Vicente E. Montaño (Contact Author)

University of Mindanao ( email )

Bolton St
Davao City, Davao del Sur 8021
Philippines

Rosalia Gabronino

College of Business Education ( email )

Bolton St
Davao City, Davao del Sur 8021
Philippines

Restie E. Torres

University of Mindanao

Bolton St
Davao City, Davao del Sur 8021
Philippines

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