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Retailer concentration and product innovation in food manufacturing

Author

Listed:
  • Christoph R. Weiss
  • Antje Wittkopp

Abstract

The increasing concentration of retailing in many countries (particularly in Europe) is a cause for concern for competition authorities. In a formal model, we argue that retailer market power influences upstream firms' incentives to introduce new products. On the basis of a survey of German food manufacturing firms, the results of a negative binomial regression model suggest a detrimental effect of retailer market power on product innovation. This effect is mitigated if manufacturing firms also have some market power (countervailing power). Innovations are positively related to the firms' market share. Copyright 2005, Oxford University Press.

Suggested Citation

  • Christoph R. Weiss & Antje Wittkopp, 2005. "Retailer concentration and product innovation in food manufacturing," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 32(2), pages 219-244, June.
    • Handle: RePEc:oup:erevae:v:32:y:2005:i:2:p:219-244
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    Citations

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    Cited by:

    1. Herrmann, Roland & Schröck, Rebecca, 2011. "Determinanten des Innovationserfolgs: eine Analyse mit Scannerdaten für den deutschen Joghurtmarkt," German Journal of Agricultural Economics, Humboldt-Universitaet zu Berlin, Department for Agricultural Economics, vol. 60(03), pages 1-16, August.
    2. Jan Schiefer & Stefan Hirsch & Monika Hartmann & Adelina Gschwandtner, 2013. "Industry, firm, year and country effects on profitability in EU food processing," Studies in Economics 1309, School of Economics, University of Kent.
    3. Stefan Hirsch & Adelina Gschwandtner, 2013. "Profit persistence in the food industry: evidence from five European countries," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 40(5), pages 741-759, December.
    4. Patrick Waelbroeck & Marie-Laure Allain, 2007. "La concurrence entre distributeurs favorise-t-elle la variété des produits ?," Économie et Prévision, Programme National Persée, vol. 178(2), pages 1-14.
    5. repec:got:cegedp:66 is not listed on IDEAS
    6. Deepananda Herath & John Cranfield & Spencer Henson & David Sparling, 2008. "Firm, market, and regulatory factors influencing innovation and commercialization in Canada's functional food and nutraceutical sector," Agribusiness, John Wiley & Sons, Ltd., vol. 24(2), pages 207-230.
    7. Adelina Gschwandtner & Stefan Hirsch, 2018. "What Drives Firm Profitability? A Comparison of the US and EU Food Processing Industry," Manchester School, University of Manchester, vol. 86(3), pages 390-416, June.
    8. Acharyya, Rajat & Banerjee, Swapnendu, 2012. "On tariff and quality innovation in a market with discrete preferences," Economic Modelling, Elsevier, vol. 29(3), pages 917-925.
    9. Stefan Hirsch & David Lanter & Robert Finger, 2021. "Profitability and profit persistence in EU food retailing: Differences between top competitors and fringe firms," Agribusiness, John Wiley & Sons, Ltd., vol. 37(2), pages 235-263, April.
    10. Alessandro Scuderi & Giovanni La Via & Giuseppe Timpanaro & Luisa Sturiale, 2022. "The Digital Applications of “Agriculture 4.0”: Strategic Opportunity for the Development of the Italian Citrus Chain," Agriculture, MDPI, vol. 12(3), pages 1-13, March.
    11. Marcello Stanco & Concetta Nazzaro & Marco Lerro & Giuseppe Marotta, 2020. "Sustainable Collective Innovation in the Agri-Food Value Chain: The Case of the “Aureo” Wheat Supply Chain," Sustainability, MDPI, vol. 12(14), pages 1-14, July.
    12. Hoffman, Angela & Senkler, Heike, 2011. "Interformat price competition of multi-product retailers: Evidence for German grocery retailing," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114533, European Association of Agricultural Economists.
    13. Carsten Eckel, 2009. "International Trade and Retailing," CESifo Working Paper Series 2597, CESifo.
    14. Grashuis, Jasper & Dary, Stanley Kojo, 2017. "An empirical investigation of patent and trademark ownership propensity and intensity in the U.S. food and drink industry," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 20(5).
    15. Mark Vancauteren, 2018. "The effects of human capital, R&D and firm’s innovation on patents: a panel study on Dutch food firms," The Journal of Technology Transfer, Springer, vol. 43(4), pages 901-922, August.
    16. Eckel, Carsten, 2007. "International trade and retailing: Diversity versus accessibility and the creation of retail deserts," University of Göttingen Working Papers in Economics 66, University of Goettingen, Department of Economics.
    17. Ivana Blazkova, & Ondrej Dvoulety, 2017. "Is the price-cost margin affected by the market concentration? Evidence from the Czech food and beverages industry," Business and Economic Horizons (BEH), Prague Development Center, vol. 13(2), pages 256-269, May.
    18. Olbrich, Rainer & Jansen, Hans Christian & Hundt, Michael, 2017. "Effects of pricing strategies and product quality on private label and national brand performance," Journal of Retailing and Consumer Services, Elsevier, vol. 34(C), pages 294-301.
    19. Sarah A. Low & Martha Bass & Dawn Thilmany & Marcelo Castillo, 2021. "Local Foods Go Downstream: Exploring the Spatial Factors Driving U.S. Food Manufacturing," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(3), pages 896-915, September.
    20. Eliana Viviano & Luciana Aimone Gigio & Emanuela Ciapanna & Daniele Coin & Fabrizio Colonna & Federica Lagna & Raffaele Santioni, 2012. "The retail trade sector and the food industry in Italy," Questioni di Economia e Finanza (Occasional Papers) 119, Bank of Italy, Economic Research and International Relations Area.
    21. Herrmann, Roland & Schröck, Rebecca, 2011. "Determinanten des Innovationserfolgs: eine Analyse mit Scannerdaten für den deutschen Joghurtmarkt," Journal of International Agricultural Trade and Development, Journal of International Agricultural Trade and Development, vol. 60(3).
    22. Karantininis, Kostas & Sauer, Johannes & Furtan, William Hartley, 2010. "Innovation and integration in the agri-food industry," Food Policy, Elsevier, vol. 35(2), pages 112-120, April.

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