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Measuring The Market Power Of The U.S. Wheat Exporters In Asian Countries: An Issue About Adjustment Of Nominal Exchange Rate When Using As A Cost Shifter; The Competitiveness Of The U.S. Wheat Exporters In Asian Countries

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  • Cho, Guedae
  • Jin, Hyun Joung
  • Koo, Won W.

Abstract

The objective of this article is to measure the market power of U.S. grain exporters in the Asian countries. This study revisits the issue of the market power with the Goldberg and Knetter (1999) model, addressing an issue about using nominal exchange rate as a cost shifter. This study proposes an adjusted nominal exchange rate deflated by inflation rates of exporting countries and exchange rate risk as another possible risk shifter. The results of the preliminary estimation show that using the adjusted exchange rate provides better results. The results also show that U.S. wheat exporters have market power in Philippine, Korea, Malaysia, and Singapore, while no market power in Indonesia and Japan. Australia plays a significant role in constraining the market power of U.S. wheat exporters in the Asian market, suggesting that a proper economic model in the Asian country might be U.S.-Australia duopoly model.

Suggested Citation

  • Cho, Guedae & Jin, Hyun Joung & Koo, Won W., 2002. "Measuring The Market Power Of The U.S. Wheat Exporters In Asian Countries: An Issue About Adjustment Of Nominal Exchange Rate When Using As A Cost Shifter; The Competitiveness Of The U.S. Wheat Export," 2002 Annual meeting, July 28-31, Long Beach, CA 19885, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea02:19885
    DOI: 10.22004/ag.econ.19885
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    References listed on IDEAS

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    1. Carter, Colin A. & MacLaren, Donald & Yilmaz, Alper, 1999. "How Competitive Is The World Wheat Market?," Working Papers 11973, University of California, Davis, Department of Agricultural and Resource Economics.
    2. Knetter, Michael M, 1989. "Price Discrimination by U.S. and German Exporters," American Economic Review, American Economic Association, vol. 79(1), pages 198-210, March.
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    Cited by:

    1. Glauben, Thomas & Imamverdiyev, Nizami & Perekhozhuk, Oleksandr & Prehn, Sören, 2014. "Competitive Structure of Kazakhstan, Russia and Ukraine in World Wheat Market: Gravity Model Approach," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182949, European Association of Agricultural Economists.

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