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Imperfect Competition in German Food Retailing: Evidence from State Level Data

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  • Sven Anders

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Abstract

An increase in the level of retail concentration in food markets across Europe has raised concerns about the implications of retail dominance in the food supply. This paper measures oligopoly and oligopsony market power in the German food retail industry and incorporate specific details about the German meat market and the European BSE crisis. In this paper, simultaneous estimates of the degree of oligopoly and oligopsony market power in the German food retail industry are derived by applying a set of monthly state level retail beef and pork marketing data in the federal state of Hessen, Germany, from 1995–2000. Results strongly suggest evidence of retail oligopoly and oligopsony power. Lerner index estimates indicate retail market power accounts for 0.5% to 11% of the retail unit margins of beef and pork. Copyright International Atlantic Economic Society 2008

Suggested Citation

  • Sven Anders, 2008. "Imperfect Competition in German Food Retailing: Evidence from State Level Data," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 36(4), pages 441-454, December.
  • Handle: RePEc:kap:atlecj:v:36:y:2008:i:4:p:441-454
    DOI: 10.1007/s11293-008-9136-8
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    References listed on IDEAS

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    1. Alexandre Gohin & Hervé Guyomard, 2000. "Measuring Market Power for Food Retail Activities: French Evidence," Journal of Agricultural Economics, Wiley Blackwell, vol. 51(2), pages 181-195.
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    Citations

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    Cited by:

    1. Ng, Desmond W. & Salin, Victoria, 2012. "An Institutional Approach to the Examination of Food Safety," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 15(2).
    2. Soregaroli, Claudio & Sckokai, Paolo & Moro, Daniele, 2011. "Agricultural policy modelling under imperfect competition," Journal of Policy Modeling, Elsevier, vol. 33(2), pages 195-212, March.
    3. Perekhozhuk Oleksandr & Hockmann Heinrich & Fertő Imre & Bakucs Lajos Zoltán, 2013. "Identification of Market Power in the Hungarian Dairy Industry: A Plant-Level Analysis," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 11(1), pages 1-13, January.
    4. Flaig, Dorothee & Rubin, Ofir & Siddig, Khalid, 2013. "Imperfect competition, border protection and consumer boycott: The future of the dairy industry in Israel," Journal of Policy Modeling, Elsevier, vol. 35(5), pages 838-851.
    5. Perekhozhuk, Oleksandr & Matyukha, Andriy & Glauben, Thomas, 2011. "Estimating the Degree of Buyers' Market Power: Evidence from the Ukrainian Meat Processing Industry," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114782, European Association of Agricultural Economists.
    6. Dieter Pennerstorfer & Franz Sinabell, 2013. "Spatial Price Differentiation and Regional Market Power. The Case of Food-Retailing in Austria," WIFO Working Papers 458, WIFO.
    7. Zavelberg, Yvonne & Wieck, Christine & Heckelei, Thomas, 2014. "How can the differences in German raw milk prices be explained? An empirical investigation of market power asymmetries and other price determinants," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182952, European Association of Agricultural Economists.
    8. Klaus Salhofer & Christoph Tribl & Franz Sinabell, 2012. "Market power in Austrian food retailing: the case of milk products," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 39(1), pages 109-122, February.
    9. repec:bla:jageco:v:68:y:2017:i:3:p:861-880 is not listed on IDEAS
    10. Ng, Desmond W. & Salin, Victoria, 2012. "An Institutional Approach to the Examination of Food Safety," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association (IFAMA), vol. 15(2).

    More about this item

    Keywords

    Food retailing; Meat marketing; Oligopoly; Oligopsony; Conjectural variation; BSE; Germany; C10; C32; D21; L10; L13; L66; O50; Q13; R10;

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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