RT Report
T1 Market Integration Dynamics and Asymptotic Price Convergence in Distribution
A1 García Hiernaux, Alfredo Alejandro
A1 Guerrero, David E.
A1 McAleer, Michael
AB In this paper we analyse the market integration process of the relative price distribution, develop a model to analyze market integration, and present a formal test of increasing market integration. We distinguish between the economic concepts of price convergence in mean and in variance. When both types of convergence occur, prices are said to converge in distribution. We present concepts and denitions related to the market integration process, link this to price convergence in distribution, argue that the Law of One Price (LOP) is not a sucient condition for market integration, and present a formal test of price convergence in distribution.In the empirical analysis, we analyze integration of the inland grains market in 19th Century USA.
YR 2013
FD 2013
LK https://hdl.handle.net/20.500.14352/41500
UL https://hdl.handle.net/20.500.14352/41500
LA eng
NO JEL: C22, C32, N70, F15.Revised: August 2013.
NO Ministerio de Ciencia e Innovación
NO Fundación Ramón Areces
NO National Science Council, Taiwan
NO Australian Research Council
DS Docta Complutense
RD 17 abr 2025