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Dynamic Adjustment in Vertically Linked Markets: The Case of the U.S. Beef Industry
Author(s) -
Buhr Brian L.,
Kim Hanho
Publication year - 1997
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 - 10.2307/1243948
Subject(s) - feedlot , beef industry , industrial organization , meat packing industry , business , vertical integration , economics , agricultural economics , zoology , food science , chemistry , biology
This duality model is used to investigate the dynamic structure of vertically linked sectors of the U.S. beef industry. The model employed allows for explicit hypothesis tests of the adjustment process and technology change. Vertically related sectors of the beef industry are included to emulate the organizational structure of the industry. Results suggest that the cow‐calf, feedlot, and beef processing sectors of the U.S. industry face significant adjustment costs. Another important finding is that imports may provide a way for the U.S. beef industry to adjust to short‐run market changes.