Agricultural Contracts and Alternative Marketing Options: A Matching Analysis
AbstractThe increasing use of agricultural contracts and processor concentration raises concerns that processors may offer lower contract prices in absence of competition from other local contractors and spot markets. This study examines the price competitiveness of marketing and production contracts depending on the availability of alternative marketing options. A propensity score matching method is used to compare prices using contract data from a farm-level national survey. The results show that the absence of other contractors or spot markets in producers’ areas does not lead to significant price differences in agricultural contracts for most commodities, providing evidence that most agricultural processors do not exercise market power by reducing prices when other local buyers are not available.
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Bibliographic InfoPaper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida with number 6336.
Date of creation: 2008
Date of revision:
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More information through EDIRC
alternative marketing options; local competition; marketing contracts; production contracts; agricultural prices; propensity score matching; Agribusiness; Marketing;
Other versions of this item:
- Katchova, Ani L., 2010. "Agricultural Contracts and Alternative Marketing Options: A Matching Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 42(02), May.
- Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
This paper has been announced in the following NEP Reports:
- NEP-AGR-2008-11-18 (Agricultural Economics)
- NEP-ALL-2008-11-18 (All new papers)
- NEP-COM-2008-11-18 (Industrial Competition)
- NEP-MKT-2008-11-18 (Marketing)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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