Spatial price transmission in litchi industry

In order to know whether a linkage of litchi's price exists between different markets in China, a vector autoregressive model was established based on the daily data on litchi's purchase price in Hainan Province, Guangdong Province and Guangxi Province from 2012 to 2016. After studying the conduction effect of litchi price between different regions by Granger causality analysis, impulse response function and variance decomposition, we found that price transmissions did exist between different provinces in litchi industry, more specifically, the transmission of litchi's purchase price were all positive and there existed a lag during the litchi's price transmission period.