Agricultural price transmission elasticity: importance of controlling for unobserved common factors
重新评估了世界粮食价格冲击对国内市场的长短期传导弹性，采用共同因素框架控制与解释变量相关的未观测共同因素，发现忽略这些因素会导致弹性估计向上偏误。
Abstract A voluminous amount of the literature estimates price transmission from world markets to domestic markets ignoring unobserved factors that commonly affect domestic markets. This article reevaluates the long‐run and short‐run transmission elasticity of world food price shocks to domestic markets using a “common factor framework” that takes unobserved common factors that are correlated with regressors into consideration. In the estimation, annual price data for rice, wheat, and maize for a panel of developed and developing countries that are observed over the period of 1960–2007 are used. The results from a common factor framework to those that do not account for common factors are then compared. Our findings suggest that ignorance of common factors is likely to result in upwardly biased elasticity estimates.