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Price or Quantity Competition? Oligopolistic Structures in International Commodity Markets
Author(s) -
Carter Colin A.,
MacLaren Donald
Publication year - 1997
Publication title -
review of international economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.513
H-Index - 58
eISSN - 1467-9396
pISSN - 0965-7576
DOI - 10.1111/1467-9396.00063
Subject(s) - economics , oligopoly , stackelberg competition , commodity , competition (biology) , microeconomics , product differentiation , product market , index (typography) , product (mathematics) , econometric model , market structure , perfect competition , econometrics , cournot competition , market economy , ecology , geometry , mathematics , incentive , world wide web , computer science , biology
International commodity markets may be characterized by price or quantity competition and by product differentiation. As an illustration, this paper presents a set of models of the Japanese market for imported beef. The models are evaluated using a non‐nested econometric test. The one which best fits the data is a Stackelberg model with price leadership by Australia. This result provides evidence on the explicit nature of the game being played by exporters, unlike the applied conjectural variations approach which provides only an index of how competitive the market is.