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Marketing Agencies And The Economics Of Market Segmentation

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  • Martin, S.K.
  • Zwart, A.C.
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    Abstract

    Increasing importance is being attached to market segmentation strategies as a means of increasing producer returns. In this paper, a generalised model of price discrimination without supply control is developed to analyse the implications of optimal segmentation strategies for non-homogeneous products. It is shown that the magnitude of producer returns is dependent on demand and supply conditions, with increases in returns falling as price elasticities of demand and supply increase. The model is applied to the New Zealand sheep meats industry to reveal that returns to producers from market segmentation strategies could be quite low in the long run.

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    File URL: http://purl.umn.edu/22271
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    Bibliographic Info

    Article provided by Australian Agricultural and Resource Economics Society in its journal Australian Journal of Agricultural Economics.

    Volume (Year): 31 (1987)
    Issue (Month): 03 (December)
    Pages:

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    Handle: RePEc:ags:ajaeau:22271

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    Keywords: Marketing;

    References

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    1. Rae, Allan N., 1978. "An Evaluation Of A New Zealand Marketing Board'S Supply Diversion Strategies," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 22(01), April.
    2. Schmalensee, Richard, 1981. "Output and Welfare Implications of Monopolistic Third-Degree Price Discrimination," American Economic Review, American Economic Association, vol. 71(1), pages 242-47, March.
    3. Reeves, G.W. & Longmire, James L., 1982. "A Note on the Theory of Price Determination in the Australian Beef Market," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 50(01), April.
    4. Cronin, M.R., 1979. "Export Demand Elasticities With Less Than Perfect Markets," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 23(01), April.
    5. Freebairn, John W. & Gruen, Fred H.G., 1977. "Marketing Australian Beef And Export Diversification Schemes," Australian Journal of Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 21(01), April.
    6. M.R. Cronin, 1979. "Export Demand Elasticities With Less Than Perfect Markets," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 23(1), pages 69-72, 04.
    7. Alston, Julian M. & Freebairn, John W., 1988. "Producer Price Equalization," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 56(03), December.
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