High cereal prices and the prospects for relief by expansion of private label and antitrust enforcement
This article responds to key points in the GMA Fact Sheet Analysis of cereal industry conduct and performance. It also explains the organization of the industry using research by Wall Street analysts that document high concentration, barriers to entry, and noncompetitive pricing games. The result is high price cost margins and high prices. The judge's decision in State of New York v. P. Morris Kraft General Foods et al. is critiqued. She relies upon a broad definition of competition that compromises the role of price in achieving allocative efficiency in markets. The new application of the antitrust laws to unilateral market power is explained. Finally the prospects for price relief through expansion of private label cereals, although complex, are reasonably good. [EconLit cites: L100, L410, L660] © 1999 John Wiley & Sons, Inc.
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Volume (Year): 15 (1999)
Issue (Month): 2 ()
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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.:
- Ronald W. Cotterill & Lawrence E. Haller, 1997.
"An Econometric Analysis of the Demand for RTE Cereal: Product Market Definition and Unilateral Market Power Effects,"
Food Marketing Policy Center Research Reports
035, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
- Cotterill, Ronald W. & Haller, Lawrence E., 1997. "An Econometric Analysis of the Demand for RTE Cereal: Product Market Definition and Unilateral Market Power Effects," Research Reports 25218, University of Connecticut, Food Marketing Policy Center.
- Langan, Glenn E. & Cotterill, Ronald W., 1994. "Estimating Brand Level Demand Elasticities and Measuring Market Power for Regular Carbonated Soft Drinks," Working Papers 116168, Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance. Full references (including those not matched with items on IDEAS)