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Pricing-to-Market versus Residual Demand Elasticity Analysis of Imperfect Competition in Food Exports: Evidence from Germany

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  • Glauben Thomas

    (Department of Food Economics, University of Kiel, Germany)

  • Loy Jens-Peter

    (Department of Agricultural Economics, University of Goettingen, Germany)

Abstract

This paper examines the exercise of market power by German food and beverage export industries over international markets. Two approaches are used: pricing-to-market (PTM) and residual demand elasticity (RDE). We find that, while in some cases the PTM approach indicates market power, the RDE approach does not. Competitive conduct seems to prevail in these industries. The occurrence of PTM in some cases might be explained by fixed contracts, which are often used in the food and beverage export market.

Suggested Citation

  • Glauben Thomas & Loy Jens-Peter, 2002. "Pricing-to-Market versus Residual Demand Elasticity Analysis of Imperfect Competition in Food Exports: Evidence from Germany," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 1(1), pages 1-21, October.
    • Handle: RePEc:bpj:bjafio:v:1:y:2002:i:1:n:3
    DOI: 10.2202/1542-0485.1004
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    References listed on IDEAS

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    Cited by:

    1. Saghaian, Sayed H. & Reed, Michael R., 2004. "Integrating Marginal Cost into Pricing-to-market Models for U.S. Agricultural Products," CAFRI: Current Agriculture, Food and Resource Issues, Canadian Agricultural Economics Society, issue 5, pages 1-17, July.
    2. Till Dannewald & Lutz Hildebrandt, 2008. "A Brand Specific Investigation of International Cost Shock Threats on Price and Margin with a Manufacturer-Wholesaler-Retailer Model," SFB 649 Discussion Papers SFB649DP2008-070, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
    3. Reed, Michael R. & Saghaian, Sayed H., 2004. "Measuring the Intensity of Competition in the Japanese Beef Market," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 36(1), pages 113-121, April.
    4. Zhang, Qiang & Reed, Michael R. & Saghaian, Sayed H., 2007. "Export Market Pricing Decisions and Market Power in World Grain Markets: A Duopoly Model for Soybeans," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34949, Southern Agricultural Economics Association.

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