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TESTING OLIGOPOLISTIC AND OLIGOPSONISTIC BEHAVIOUR: AN APPLICATION TO THE US MEAT‐PACKING INDUSTRY
Author(s) -
Azzam A. M.,
Pagoulatos E.
Publication year - 1990
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/j.1477-9552.1990.tb00652.x
Subject(s) - oligopoly , production (economics) , economics , market power , meat packing industry , industrial organization , function (biology) , order (exchange) , microeconomics , econometric analysis , econometric model , econometrics , estimation , beef industry , production function , cournot competition , agricultural economics , food science , monopoly , chemistry , management , finance , evolutionary biology , biology
This paper extends the conjectural approach in industrial organisation to the analysis of imperfections in output and factor markets. 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 parameterise the industry's oligopoly and oligopsony equilibria. As an example, we provide an application to the US meat‐packing industry. Our results suggest that the industry exercises market power in both the output (meat) market and the factor (live animal) market.