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The Biotechnology Sector: "Bounds" to Market Structure

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  • Sheldon, Ian M.

Abstract

This paper examines whether it makes sense to consider Sutton's "bounds" approach as a candidate theory for explaining the recent evolution of market structure in the biotechnology sector, and to speculate whether market structure will change if the industry begins to introduce second-generation GM products that are of more direct benefit to consumers. A key result is that the market structure is bounded in the presence of endogenous sunk costs, implying care should be taken when inferring any correlation between R&D expenditure and seller concentration in the biotechnology sector.

Suggested Citation

  • Sheldon, Ian M., 2008. "The Biotechnology Sector: "Bounds" to Market Structure," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6078, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea08:6078
    DOI: 10.22004/ag.econ.6078
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    References listed on IDEAS

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    Cited by:

    1. Nolan, Elizabeth & Santos, Paulo, 2009. "Evidence for increasing concentration in plant breeding industries in the United States and the European Union," 2009 Conference (53rd), February 11-13, 2009, Cairns, Australia 48060, Australian Agricultural and Resource Economics Society.

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