Testing for Oligopoly and Oligopsony Power
This paper extends the conjectural approach in industrial organization to the analysis of imperfections in output and factor markets simultaneously. Starting from the specification of a production function, the econometric analysis is based on the formulation and estimation of a simultaneous equation model consisting of a production function, first order conditions associated with factor employment, and two conjectural elasticities to parametrize the industry's oligopoly and oligopsony equilibria. As an example, we provide an application to the U.S. meat packing industry. Our results suggest that the industry excercised market power in both the output (meat) market and the factor (live animals) market.
|Date of creation:||Sep 1989|
|Contact details of provider:|| Postal: Draper Hall, College of Food and Natural Resources, Amherst, MA 01003|
Web page: http://www.umass.edu/ne165/
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- Schroeter, John R, 1988.
"Estimating the Degree of Market Power in the Beef Packing Industry,"
The Review of Economics and Statistics,
MIT Press, vol. 70(1), pages 158-162, February.
- Schroeter, John R., 1988. "Estimating the Degree of Market Power in the Beef Packing Industry," Staff General Research Papers Archive 11114, Iowa State University, Department of Economics.
- Cowling, Keith & Waterson, Michael, 1976. "Price-Cost Margins and Market Structure," Economica, London School of Economics and Political Science, vol. 43(171), pages 267-274, August.
- Cowling, Keith & Waterson, Michael, 1974. "Price-Cost Margins and Market Structure," The Warwick Economics Research Paper Series (TWERPS) 044, University of Warwick, Department of Economics.
- Appelbaum, Elie, 1982. "The estimation of the degree of oligopoly power," Journal of Econometrics, Elsevier, vol. 19(2-3), pages 287-299, August.
- Gollop, Frank M. & Roberts, Mark J., 1979. "Firm interdependence in oligopolistic markets," Journal of Econometrics, Elsevier, vol. 10(3), pages 313-331, August. Full references (including those not matched with items on IDEAS)