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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.

Suggested Citation

  • Richard E. Just & Wen S. Chern, 1980. "Tomatoes, Technology, and Oligopsony," Bell Journal of Economics, The RAND Corporation, vol. 11(2), pages 584-602, Autumn.
  • Handle: RePEc:rje:bellje:v:11:y:1980:i:autumn:p:584-602
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    Citations

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    Cited by:

    1. Karp, Larry S & Perloff, Jeffrey M, 1989. "Estimating Market Structure and Tax Incidence: The Japanese Television Market," Journal of Industrial Economics, Wiley Blackwell, vol. 37(3), pages 225-239, March.
    2. Iddo Kan, 2008. "Yield quality and irrigation with saline water under environmental limitations: the case of processing tomatoes in California," Agricultural Economics, International Association of Agricultural Economists, vol. 38(1), pages 57-66, January.
    3. Satish Y. Deodhar & Ian M. Sheldon, 1995. "Is Foreign Trade (Im)Perfectly Competitive?: An Analysis Of The German Market For Banana Imports," Journal of Agricultural Economics, Wiley Blackwell, vol. 46(3), pages 336-348.
    4. Perloff, Jeffrey M, 1991. "Econometric analysis of imperfect competition and implications for trade research," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt46w1j22d, Department of Agricultural & Resource Economics, UC Berkeley.
    5. 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.
    6. Rodgers, Yana van der Meulen, 1998. "Empirical investigation of one OPEC country's successful non-oil export performance," Journal of Development Economics, Elsevier, vol. 55(2), pages 399-420, April.
    7. Vítor Marques & Isabel Soares & Adelino Fortunato, 2012. "Application of a Structural Model to the Spanish Electricity Wholesale Market," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 65-108.
    8. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107069978.
    9. David E. Buschena & Jeffrey M. Perloff, 1991. "The Creation of Dominant Firm Market Power in the Coconut Oil Export Market," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(4), pages 1000-1008.
    10. Vítor Marques & Adelino Fortunato & Isabel Soares, 2012. "Can Structural Models be Useful to Understand the Electricity Wholesale Markets? An Application to Spain," Chapters,in: Recent Advances in the Analysis of Competition Policy and Regulation, chapter 15 Edward Elgar Publishing.
    11. repec:spr:jecfin:v:41:y:2017:i:3:d:10.1007_s12197-016-9360-z is not listed on IDEAS
    12. Patterson, Paul M. & Abbott, Philip C., 1991. "An Evaluation of the Piers Data for Use in Economic Analysis of U.S. Agricultural and Food Product Trade," Occasional Papers 233070, Regional Research Project NC-194: Organization and Performance of World Food Systems.
    13. Brandt, Jon A. & French, Ben C., 1981. "An Analysis of Economic Relationships and Projected Adjustments in the U.S. Processing Tomato Industry," Research Reports 251943, University of California, Davis, Giannini Foundation.
    14. 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.
    15. 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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