This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Market Power with Dynamic Invertory Constraints: The Bias in Standard Measures

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Lynn Hunnicutt
David Aadland

Additional information is available for the following registered author(s):

Abstract

This paper incorporates inventory dynamics into an analysis of market power. Using a model in which each firm accounts for the effect of its current action on the current and future actions of itself and its competitors, we show that measures of market power that ignore inventory dynamics are biased. We then apply the model to the beef-packing industry using annual data on cattle stocks, slaughter and prices from 1933-1999. Our estimates suggest that static measures overestimate the amount of market power exerted by beef-packing firms.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: ftp://repec.bus.usu.edu/RePEc/usu/pdf/ERI2002-15.pdf
File Format: application/pdf
File Function: First version, 2002
Download Restriction: no

Publisher Info
Paper provided by Utah State University, Department of Economics in its series Working Papers with number 2002-15.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 26 pages
Date of creation: Aug 2002
Date of revision:
Handle: RePEc:usu:wpaper:2002-15

Contact details of provider:
Email:
Web page: http://apec.usu.edu/
More information through EDIRC

For technical questions regarding this item, or to correct its listing, contact: (John Gilbert).

Related research
Keywords:

Other versions of this item:

References listed on IDEAS
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.:
  1. Aadland, David & Bailey, DeeVon, 2001. " Short-Run Supply Responses in the U.S. Beef-Cattle Industry," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 83(4), pages 826-39, November. [Downloadable!] (restricted)
  2. Muth, Mary K. & Wohlgenant, Michael K., 1998. "A Model Of Imperfect Competition Using Marginal Input And Output Prices: Application To The Beef Packing Industry," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20853, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
  3. Schroeter, John R, 1988. "Estimating the Degree of Market Power in the Beef Packing Industry," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 158-62, February. [Downloadable!] (restricted)
    Other versions:
  4. Azzam, Azzeddine M, 1997. "Measuring Market Power and Cost-Efficiency Effects of Industrial Concentration," Journal of Industrial Economics, Blackwell Publishing, vol. 45(4), pages 377-86, December. [Downloadable!] (restricted)
  5. Schroeter, John R. & Azzam, Azzeddine, 2003. "Measuring Market Power in Multi-Product Oligopolies: The U.S. Meat Industry," Staff General Research Papers 11112, Iowa State University, Department of Economics.
    Other versions:
  6. Jarvis, Lovell S, 1974. "Cattle as Capital Goods and Ranchers as Portfolio Managers: An Application to the Argentine Cattle Sector," Journal of Political Economy, University of Chicago Press, vol. 82(3), pages 489-520, May/June. [Downloadable!] (restricted)
  7. Rosen, Sherwin & Murphy, Kevin M & Scheinkman, Jose A, 1994. "Cattle Cycles," Journal of Political Economy, University of Chicago Press, vol. 102(3), pages 468-92, June. [Downloadable!] (restricted)
    Other versions:
  8. Michael H. Riordan, 1985. "Imperfect Information and Dynamic Conjectural Variations," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 41-50, Spring. [Downloadable!] (restricted)
  9. Pindyck, Robert S, 1985. "The Measurement of Monopoly Power in Dynamic Markets," Journal of Law & Economics, University of Chicago Press, vol. 28(1), pages 193-222, April.
    Other versions:
  10. Corts, Kenneth S., 1998. "Conduct parameters and the measurement of market power," Journal of Econometrics, Elsevier, vol. 88(2), pages 227-250, November. [Downloadable!] (restricted)
  11. Baak, Saang Joon, 1999. "Tests for bounded rationality with a linear dynamic model distorted by heterogeneous expectations," Journal of Economic Dynamics and Control, Elsevier, vol. 23(9-10), pages 1517-1543, September. [Downloadable!] (restricted)
  12. Roberts, M.J. & Samuelson, L., 1988. "An Empirical Analysis Of Dynamic, Non-Price Competition In An Oligopolistic Industry," Papers 3-88-14, Pennsylvania State - Department of Economics.
    Other versions:
  13. Bresnahan, Timothy F., 1989. "Empirical studies of industries with market power," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 17, pages 1011-1057 Elsevier. [Downloadable!] (restricted)
  14. Fershtman, Chaim & Kamien, Morton I, 1987. "Dynamic Duopolistic Competition with Sticky Prices," Econometrica, Econometric Society, vol. 55(5), pages 1151-64, September. [Downloadable!] (restricted)
  15. Dockner, Engelbert J, 1992. "A Dynamic Theory of Conjectural Variations," Journal of Industrial Economics, Blackwell Publishing, vol. 40(4), pages 377-95, December. [Downloadable!] (restricted)
  16. Azzam, A & Park, T, 1993. "Testing for Switching Market Conduct," Applied Economics, Taylor and Francis Journals, vol. 25(6), pages 795-800, June.
  17. Driskill, Robert A. & McCafferty, Stephen, 1989. "Dynamic duopoly with adjustment costs: A differential game approach," Journal of Economic Theory, Elsevier, vol. 49(2), pages 324-338, December. [Downloadable!] (restricted)
  18. Weliwita, Ananda & Azzam, Azzeddine, 1996. "Identifying Implicit Collusion Under Declining Output Demand," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 21(02), December. [Downloadable!]
  19. Nerlove, Marc & Fornari, Ilaria, 1998. "Quasi-rational expectations, an alternative to fully rational expectations: An application to US beef cattle supply," Journal of Econometrics, Elsevier, vol. 83(1-2), pages 129-161. [Downloadable!] (restricted)
Full references

Statistics
Access and download statistics

Did you know? No RePEc service, like IDEAS, charges for the use or the display of bibliographic data.

This page was last updated on 2009-11-8.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.