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Imperfect Competition in Multiproduct Food Industries with Application to Pear Processing
Author(s) -
Wann Joyce J.,
Richard J. Sexton
Publication year - 1992
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 - 10.2307/1243196
Subject(s) - market power , oligopoly , imperfect competition , pear , industrial organization , competition (biology) , product (mathematics) , food processing , economics , agriculture , market structure , product market , raw material , business , microeconomics , commerce , computer science , cournot competition , monopoly , food science , ecology , chemistry , mathematics , biology , organic chemistry , incentive , geometry , world wide web
Agricultural product markets often involve relatively few firms processing a farm product into multiple processed products. This market structure prompts concern that processing firms may exercise both oligopsony and oligopoly power. The present paper develops and applies a methodology to test simultaneously for market power in both the raw input market and multiple processed output markets. Application of the methodology to California pear processing indicates the industry has exerted power in both its farm input market and the markets for canned pears and fruit cocktail.