Investigating Price Asymmetry in Market of Iran’s Sugar Imports

In this study, using annual data over the period 1992-2014, asymmetry of sugar market with Johansen co-integration technique and estimation of error correction model were investigated. The application of collective method in import market indicates at least one long-term relationship between the variables of domestic and import prices. Granger causality test showed that there was a one-way Granger causality relationship of import prices to domestic ones not a two-way causality relationship. The estimation of price transmission from imported to domestic price indicates asymmetry in price transmission mechanism of the market of sugar imports in Iran. The study of the main reason for this asymmetry is to use the concentration ratio indexes and Herfindahl- Hirschman indicating high concentration and the dominance of two countries of UAE and Brazil in the market of imports of sugar in Iran.