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Tomatoes, Technology, and Oligopsony

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  • Richard E. Just
  • Wen S. Chern

Abstract

This paper draws on the theory of monopsony and oligopsony to develop an empirical test for the presence of the market power where an exogenous shock on the relevant market may be observed. An application of this test is demonstrated for the tomato processing industry, where the exogenous shock is created by the introduction of mechanical harvesting technology. The results are remarkably consistent with oligopsonistic dominant firm-price leadership. Statistical tests suggest rejection of the null hypothesis of competition.

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Bibliographic Info

Article provided by The RAND Corporation in its journal Bell Journal of Economics.

Volume (Year): 11 (1980)
Issue (Month): 2 (Autumn)
Pages: 584-602

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Handle: RePEc:rje:bellje:v:11:y:1980:i:autumn:p:584-602

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Cited by:
  1. Buschena, David E. & Perloff, Jeffrey M, 1990. "The creation of dominant firm market power in the coconut oil export market," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt9c5124mq, Department of Agricultural & Resource Economics, UC Berkeley.
  2. Karp, Larry & Perloff, Jeffrey M, 1987. "Estimating market structure and tax incidence: the Japanese television market," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt8769c17g, Department of Agricultural & Resource Economics, UC Berkeley.
  3. Catherine D. Wolfram, 1999. "Measuring Duopoly Power in the British Electricity Spot Market," American Economic Review, American Economic Association, vol. 89(4), pages 805-826, September.
  4. Oleksandr Perekhozhuk, 2013. "Modern Concepts for Pricing Analysis in Imperfect Competition Production Factor Market," Accounting and Finance, Institute of Accounting and Finance, issue 4, pages 99-106, December.
  5. Guci, Ledia & Brown, Mark G., 2007. "Changes in the Structure of the Florida Processed Orange Industry and Potential Impacts on Competition," Research Papers 2007 36811, Florida Department of Citrus.

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