A Model of the Dynamics of the Relationship between the Prices of World Crude Oil and the Prices Of Rice

This study aimed to investigate the dynamics of long-term relationship between the prices of crude oil and the prices of rice within the period from January 2004 to March 2015. Crude oil prices referred to the prices issued by West Texas Intermediate (WTI), and rice prices to the prices of rough-rice published by FxPro. Both of them were monthly data and were analyzed by using the linear regression test with a time lag, which is a special form of the LVAR causal model of general univariate. Test results show that there was a one-way dynamics relationship between the two variables, i.e. oil prices affect prices of rice. The dynamics of this relationship began to occur at the end of January 2004. The dynamics of the relationship was positive, meaning that when crude oil prices rose (fell), the prices of rice rose (fell) as well