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Market Power And Cost-Efficiency Effects Of The Market Concentration In The U.S. Nitrogen Fertilizer Industry

Author

Listed:
  • Kim, C.S.
  • Hallahan, Charles B.
  • Taylor, Harold
  • Schluter, Gerald E.

Abstract

This article examines the effects of increasing market concentration level in the U.S. nitrogen fertilizer industry. Results indicate that the costs of market power are greater than the benefits of market concentration, in terms of manufacturing cost efficiency. To provide a stable nitrogen fertilizer supply at a relatively low price, it may be necessary to control natural gas price and/or reduce new import barriers from Middle East and former member states of the Soviet Union, where low cost gas is produced as a byproduct.

Suggested Citation

  • Kim, C.S. & Hallahan, Charles B. & Taylor, Harold & Schluter, Gerald E., 2002. "Market Power And Cost-Efficiency Effects Of The Market Concentration In The U.S. Nitrogen Fertilizer Industry," 2002 Annual meeting, July 28-31, Long Beach, CA 19674, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea02:19674
    DOI: 10.22004/ag.econ.19674
    as

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    File URL: https://ageconsearch.umn.edu/record/19674/files/sp02ki07.pdf
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    References listed on IDEAS

    as
    1. Binswanger, Hans P, 1974. "The Measurement of Technical Change Biases with Many Factors of Production," American Economic Review, American Economic Association, vol. 64(6), pages 964-976, December.
    2. Adelaja, Adesoji O. & Hoque, Anwarul, 1986. "A Multi-Product Analysis Of Energy Demand In Agricultural Subsectors," Southern Journal of Agricultural Economics, Southern Agricultural Economics Association, vol. 18(2), pages 1-13, December.
    3. Munisamy Gopinath & JunJie Wu, 1999. "Environmental Externalities and the Optimal Level of Market Power," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(4), pages 825-833.
    4. Morrison Paul, Catherine J., 1999. "Production Structure And Trends In The U.S. Meat And Poultry Products Industries," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 24(2), pages 1-18, December.
    5. repec:bla:jindec:v:45:y:1997:i:4:p:377-86 is not listed on IDEAS
    6. Azzeddine M. Azzam, 1997. "Measuring Market Power and Cost‐efficiency Effects of Industrial Concentration," Journal of Industrial Economics, Wiley Blackwell, vol. 45(4), pages 377-386, December.
    7. Roberts, Roland K. & Heady, Earl O., 1982. "Fertilizer Demand Functions For Specific Nutrients Applied To Three Major U.S. Crops," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 7(2), pages 1-14, December.
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    Cited by:

    1. Zhepeng Hu & B. Wade Brorsen, 2017. "Spatial Price Transmission and Efficiency in the Urea Market," Agribusiness, John Wiley & Sons, Ltd., vol. 33(1), pages 98-115, January.
    2. Kumar, Pradeep, 2018. "Market power and cost efficiencies in banking," International Journal of Industrial Organization, Elsevier, vol. 57(C), pages 175-223.

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