Rice market integration in the Mekong River Delta: The transition to market rules in the domestic food market in Vietnam

C.H.M. Lutz, C. Praagman, L.T.D. Hai

Research output: Contribution to journalArticleAcademicpeer-review

7 Citations (Scopus)

Abstract

In the last decades Vietnam has become a major supplier in the world's rice market. This position is the result of the policy reforms that have been implemented in the agricultural sector. This paper assesses the impact of the liberalization policies and focuses on the spatial price differences in the domestic rice market. The results show that price patterns correlate strongly in the Mekong River Delta. Even prices in other regions are integrated with price patterns in the South. Interestingly, private traders in the Mekong Delta are only indirectly responsible for the latter result. They satisfy local demand and deal with state-owned enterprises (SOEs). In the framework of the national food security policy, the state-owned food companies 'subsidize' transactions between the South and the North. Moreover, the state-owned food companies still dominate export transactions. The latter issues constitute two major queries for policy makers involved in the liberalization of the rice market, as further policy measures should not jeopardize the interests of domestic rice consumers.

Original languageEnglish
Pages (from-to)517-546
Number of pages30
JournalEconomics of Transition
Volume14
Issue number3
Publication statusPublished - 2006

Keywords

  • rice
  • market integration
  • transition
  • cointegration
  • Vietnam
  • MAIZE MARKETS
  • COINTEGRATION

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