Transmission between Food Prices in Bogotá, 2000-2017

Abstract

This article aims to estimate whether there is an asymmetric transmission of changes in the wholesale prices of various foods to consumer prices in Bogotá, and what relationship it may have with the degree of perishability. For this purpose, the evolution of prices and gross margin was characterized based on volatility and the ADF unit root test; the Koyck model was estimated to quantify the contemporary effect of a wholesale price change, the speed of adjustment, the number of months to reach half of the final impact, and the value of that impact. Finally, a model was estimated to differentiate the effect of an increase and a decrease in wholesale prices. For non-perishable foods, greater volatility was recorded in the gross margin, less transmission of the magnitude of the change, greater sensitivity to increases, and asymmetry in transmission.