For several decades, the government of India has implemented a minimum support price (MSP) policy for agricultural commodities to reduce price risk levels for farmers. Concerns have been raised about whether this policy could affect market integration of related agricultural products, modify price incentives, and ultimately alter resource allocation and production between commodities. This study uses a panel vector auto-regression model across six states for the period 2002-2017 to analyse the effects of the MSP on the transmission of price shocks between cereals and oilseeds. The results demonstrate that the MSP partially and completely offsets price linkages between agricultural commodities, potentially introducing distortions in price incentives that affect land allocation and production between commodities. Beyond the effects of the MSP across commodities, Indian authorities can expect that price shocks on maize be transmitted to soybean over the next production period. Finally, this study demonstrates that the use of alternative data frequencies can identify differences in market reactions over time that can be related to production cycles and delays in price transmission.

中文翻译：

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印度的最低支持价格政策如何影响跨大宗商品的价格联系？

几十年来，印度政府对农产品实施了最低支持价格（MSP）政策，以降低农民的价格风险水平。人们担心该政策是否会影响相关农产品的市场整合，修改价格激励措施并最终改变商品之间的资源分配和生产。这项研究使用2002年至2017年期间六个州的面板矢量自回归模型来分析MSP对谷物和油料价格冲击传递的影响。结果表明，MSP可以部分和完全抵消农产品之间的价格联系，从而可能导致价格激励扭曲，从而影响商品之间的土地分配和生产。除了MSP对各种商品的影响之外，印度当局可以预期，玉米的价格冲击将在下一个生产时期内传递给大豆。最后，这项研究表明，使用替代数据频率可以确定一段时间内市场反应的差异，这些差异可能与生产周期和价格传递的延迟有关。