Avian influenza and structural change in the Czech poultry industry

Lukáš ČECHURA; Tereza TAUSSIGOVÁ

Avian influenza and structural change in the Czech poultry industry

2013

Lukáš ČECHURA | Tereza TAUSSIGOVÁ

The paper deals with the consequences of the avian influenza outbreak for the Czech poultry industry. The Hansen (1992) parameter instability test and the Gregory and Hansen (1996) residual-based test are used for testing the structural break and determining the time of the regime shift. The results provide an indication that the avian influenza outbreak might have been the reason for the changes in the value chain. However, the changes in the second stage of the value chain could also be connected with the accession of the Czech Republic to the EU. The results show that the retailers increased their market power in the second period, i.e., after September 2004. The avian influenza could be a reason for the structural break, but other factors may work together. As a result of these changes, poultry processing companies have been losing their market position, and as a consequence, the production of poultry meat in the Czech Republic has been on the decline.

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