Intertemporal pricing efficiency in agricultural markets: The case of slaughter hogs in West Germany

Abstract

It is generally believed that the structure, degree of organization and centralization of many agricultural markets is such as to warrant the provision of price information services by public bodies. However, if a case for information services is to be founded on pricing efficiency grounds it has first to be shown that prices do not reflect available information. In this paper, the hypothesis that prices reflect available information is tested for three important markets for slaughter hogs in West Germany. Results from statistical tests performed on the weekly price series did not lead to rejection of the hypothesis. Therefore it is concluded that since pricing efficiency prevails in these markets, the case for government agencies in providing information on prices is weakened.