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Product Aggregation, Market Integration, and Relationships between Prices: An Application to World Salmon Markets
Author(s) -
Asche Frank,
Bremnes Helge,
Wessells Cathy R.
Publication year - 1999
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1244016
Subject(s) - market integration , product (mathematics) , factor market , economics , product market , business , industrial organization , international economics , microeconomics , geometry , mathematics , incentive
Abstract Relationships between prices of goods offer motives of interest in at least two areas: market integration and product aggregation. There is a close relationship between market integration and aggregation, which may increase the usefulness of market integration studies. In this article, these relationships are developed and illustrated by an application to the world salmon market. It is shown that the Law of One Price holds for an international market with five salmon species. This result has significant implications for the world salmon market regarding both product aggregation in demand analyses and international trade policy.