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Imperfectly Competitive Equilibria in International Commodity Markets
Author(s) -
Kolstad Charles D.,
Burris Anthony E.
Publication year - 1986
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1241646
Subject(s) - economics , oligopoly , cournot competition , commodity , simple (philosophy) , perfect competition , competition (biology) , microeconomics , international market , nash equilibrium , industrial organization , international trade , market economy , epistemology , biology , ecology , philosophy
The simple model of perfect competition in spatial markets has been widely applied in analyzing international agricultural trade. Yet, many markets do not appear to be perfectly competitive. In this paper we offer a new and efficient method for computing spatial equilibrium in oligopolistic or oligopsonistic markets. We apply the technique to an analysis of several hypotheses of market conduct in the international wheat market that have been put forward by other authors. We conclude that a Cournot‐Nash duopsony model does not perform well in explaining trade.