Impact of COVID-19 on onion prices and volatility across spatially separated markets of India: Evidence from regression discontinuity design Kathayat Babita1,*, Cariappa A.G. Adeeth2, Mahida Darshnaben P.3 1Research Scholar, Division of Dairy Economics, Statistics and Management, ICAR – National Dairy Research Institute, Karnal-132001 (Haryana) 2Young Professional, Agriculture and Allied Sectors Vertical, NITI Aayog, New Delhi-110001 (Delhi) 3Senior Research Fellow, ICAR-NIAP, New Delhi-110 012 (Delhi) *Corresponding author's email: babitakathayat1@gmail.com
Online published on 3 February, 2023. Abstract The study evaluated the immediate impact of COVID-19 induced lockdown on onion wholesale prices across 11 states of India. Daily weighted average prices from 1 February 2019 to 30 July 2020 were used. Results of the GARCH model revealed that price volatility increased in all the states while its persistence was higher in 6 out of the 11 states studied post-lockdown. Regression Discontinuity (RD) estimated further revealed a significant price rise (9 to 34 per cent) shortly after the lockdown in most states except UP, Punjab and Rajasthan. Our findings are reliable and valid as the estimates pass several robustness tests. The study contributed to the accumulating evidence of severe supply chain disruptions taking place immediately after lockdown leading to a short-term price spike of essential commodities like an onion. Top Keywords COVID-19, GARCH, Impact, Onion prices, Price volatility, Regression discontinuity. Top |