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The Potential Impacts of State Trading Enterprises on World Markets: The Exporting Country Case
Author(s) -
Carter Colin A.,
Smith Vincent H.
Publication year - 2001
Publication title -
canadian journal of agricultural economics/revue canadienne d'agroeconomie
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.505
H-Index - 37
eISSN - 1744-7976
pISSN - 0008-3976
DOI - 10.1111/j.1744-7976.2001.tb00317.x
Subject(s) - oligopoly , economic rent , subsidy , commodity , argument (complex analysis) , economics , market power , international economics , empirical evidence , industrial organization , business , international trade , market economy , monopoly , biochemistry , chemistry , philosophy , epistemology , welfare
Export state trading enterprises (STEs) play an important role in global agricultural trade. STE behavior has significant implications for world food markets, irrespective of whether or not these markets are inherently competitive. Previous literature has suggested that STEs have market power and can earn oligopolistic rents. We find there is no compelling empirical evidence to support this argument. However, we show the cross‐commodity effects of export STEs can disrupt competitive world markets, through offering an implicit export subsidy to a downstream industry.