SABIIA - Sistema Aberto e Integrado de Informação em Agricultura (Sabiia)

The Social Value of Using Biodiversity in New Pharmaceutical Product Research

Davis, David E..

State WIC agencies in infant-formula procurement auctions receive lower bids and final prices when they are in buyer’s alliances than when they are unallied. The Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) uses an auction to procure infant formula. Manufacturers bid on the right to be an agency’s sole supplier by offering a rebate on formula sold through WIC. A theoretical model of rebates shows that bidders may shade their bids and extract surplus from agencies. An empirical estimation shows that bids are lower to alliances suggesting that alliances countervail the power of bidders to extract surplus.

Tipo: Working Paper

Palavras-chave: Auctions; Food assistance; Countervailing power; Buyer concentration; Oligopoly; WIC.; Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Industrial Organization; L13; D43; D44; Q18; I18.

Ano: 2011

URL: http://purl.umn.edu/123863

Simpson, R. David; Craft, Amy B..

Biologists and conservation advocates have expressed grave concern over perceived threats to biological diversity. "Biodiversity prospecting" -- the search among naturally occurring organisms for new products of agricultural, industrial, and, particularly, pharmaceutical value -- has been advanced as both a mechanism and a motive for conserving biological diversity. Economists and others have attempted to estimate the value of biodiversity for use in new pharmaceutical project research. Most of these existing approaches are incomplete, however, as they have not considered full social welfare, i.e., both consumer surplus and profit. This paper addresses social welfare by calibrating a model of competition between differentiated products with data from the...

Spatial Competition and Market Power in Banking

Palavras-chave: Biodiversity prospecting; Differentiated products; Pharmaceutical research and development; Biogeographic models; Global warming; Habitat conversion; Health Economics and Policy; D43; L13; Q29.

Ano: 1996

URL: http://purl.umn.edu/10877

Richards, Timothy J.; Acharya, Ram N.; Kagan, Albert.

Banks in non-metropolitan areas compete in a spatially-differentiated environment. Particularly with the advent of electronic banking services, however, there is some question as to how much market power is conferred by spatial separation from rivals. This paper estimates a structural model of the supply and demand of banking services in which pricing power is allowed to depend explicitly on the distance between rival banks. A spatial autoregressive econometric model shows that approximately 38.0% of economic surplus earned by firms in non-metropolitan banking in the upper midwest is due to spatial market power.

Empirical evidence on the role of non linear wholesale pricing and vertical restraints on cost pass-through

Palavras-chave: Banking; Market power; Non-metropolitan markets; Spatial econometrics; Community/Rural/Urban Development; Financial Economics; C21; D43; G21; L13.

Ano: 2007

URL: http://purl.umn.edu/6566

Bonnet, Céline; Dubois, Pierre; Villas-Boas, Sofia Berto.

How a cost shock is passed through into final consumer prices may relate to nominal price stickiness and rigidities, the existence of non adjustable cost components, strategic mark-up adjustments, or other contract terms along the supply distribution chain. This paper presents a simple framework to assess the potential role of non linear pricing contracts and vertical restraints such as resale price maintenance or wholesale price discrimination in the supply chain in explaining the degree of pass-through from upstream cost shocks in the ground coffee category to downstream retail prices. We do so in the German coffee market where both upstream and downstream firms make pricing decisions allowing for non linear pricing and vertical restraints. Using...

Tipo: Working Paper

Palavras-chave: Non Linear Pricing; Multiple Manufacturers and Retailers; Ground Coffee; Pass-Through; Resale Price Maintenance; Wholesale Price Discrimination; Consumer/Household Economics; C13; L13; L41.

Ano: 2009

URL: http://purl.umn.edu/120534

Environmental Labeling and Technology Adoption in the Presence of Strategic Interactions

Konishi, Yoshifumi.

This manuscript analyzes the effect of binary ecolabeling on the strategic competition of Cournot duopolists in environmental technology and the output market. Under binary labeling, firms' abatement technologies are not directly observable by consumers but are certified if they satisfy preset ecological standards. Given this asymmetry, I set up the regulator's problem as one of choosing a technology standard, or "cutoff," in emissions per unit of output, below which all abatement efficiency levels are certified. The regulatory authority faces a trade-off in choosing the socially optimal cutoff: The regulator would like to raise the standard to reduce emissions but needs to lower it in order to induce technology adoption. There are three important...

Pricing to Market, (Seasonal) Cointegration and US Agricultural Exports

Palavras-chave: Ecolabeling; Emissions; Product differentiation; Technology adoption; Environmental Economics and Policy; Industrial Organization; D43; L13; Q53; Q58.

Ano: 2007

URL: http://purl.umn.edu/9949

Xu, Yun; Sheldon, Ian M..

In this paper, we examine whether US exporters of agricultural commodities price to market. Specifically, we estimate the fixed-effects model of Knetter (1989; 1995), and alternative specifications based on the use of cost indices, and seasonal and vector error correction models that account for the time-series properties of the data.

Should Europe Further Strengthen Intellectual Property for Plant Breeders? An Analysis of Seed Industry Proposals

Palavras-chave: Pricing to market; Cointegration; US agricultural exports; International Relations/Trade; F12; L13.

Ano: 2005

URL: http://purl.umn.edu/19377

Eaton, Derek J.F.; van Tongeren, Frank W..

This paper illustrates the potential negative effects of increasing the scope of plant breeders' rights (PBR) protection, as has been proposed for Europe by leading plant breeding firms. Such a policy could increase the costs for varietal development for breeding companies, particularly if their access to varieties of the market leader is constrained. This is represented as an asymmetrical increase in breeders' cost functions in a simple model of endogenous quality choice under price competition. Increased scope of IPR protection leads to increased profits for the leading breeding company but decreases in varietal quality and both farm and overall profits.

On Pricing and Vertical Organization of Differentiated Products: The Case of Soybean Seed Industry

Palavras-chave: Intellectual property rights; Product differentiation; Plant breeding; Genetic diversity; Research and Development/Tech Change/Emerging Technologies; L13; O34; Q16.

Ano: 2005

URL: http://purl.umn.edu/24725

Shi, Guanming; Chavas, Jean-Paul.

This paper investigates the pricing and vertical organization of differentiated products under imperfect competition. In a multiproduct context, a Cournot model is used to examine how substitution/complementarity relationships among products and vertical structures can affect the exercise of market power. This motivates a generalization of the Herfindahl-Hirschman index (termed VHHI) capturing how market concentration and vertical structures interact to influence prices of differentiated products. The analysis is applied to pricing of soybean seeds in the US over the period 2000-2007. The analysis considers two vertical structures employed by biotech firms: vertical integration and licensing. The econometric analysis finds evidence that vertical...

Coordinating on Reducing Advertising: Carbonated Soft Drinks Industry and Combating Obesity

Palavras-chave: Vertical structures; Pricing; Imperfect competition; Seed; Biotechnology; Demand and Price Analysis; Industrial Organization; L13; L4; L65.

Ano: 2009

URL: http://purl.umn.edu/49186

Berning, Joshua P.; McCullough, Michael.

Replaced with revised version of paper 06/08/11.

Initial Allocation Effects in Permit Markets with Bertrand Output Oligopoly

Palavras-chave: Television advertising; Carbonated soft drink; Oligopoly advertising; Pulse advertising; Food Consumption/Nutrition/Food Safety; Health Economics and Policy; Industrial Organization; Marketing; I18; L13; M37.

Ano: 2011

URL: http://purl.umn.edu/103594

Calford, Evan M.; Heinzel, Christoph; Betz, Regina.

We analyse the efficiency effects of the initial permit allocation given to firms with market power in both permit and output market. We examine two models: a long- run model with endogenous technology and capacity choice, and a short-run model with fixed technology and capacity. In the long run, quantity pre-commitment with Bertrand competition can yield Cournot outcomes also under emissions trading. In the short run, Bertrand output competition reproduces the effects derived under Cournot competition, but displays higher pass-through profits. In a second-best setting of overallocation, a tighter emissions target tends to improve permit-market efficiency in the short run.

Tipo: Journal Article

Palavras-chave: Emissions trading; Initial permit allocation; Bertrand competition; EU ETS; Endogenous technology choice; Kreps and Scheinkman; Resource /Energy Economics and Policy; L13; Q28; D43.

Ano: 2010

URL: http://purl.umn.edu/95066

Pricing Power by Supermarket Retailers: A Ghost in the Machine?

Richards, Timothy J.; Pofahl, Geoffrey M..

Tipo: Journal Article

Palavras-chave: Agribusiness; L13; L66; Q13.

Ano: 2010

URL: http://purl.umn.edu/94764

Do International Roaming Alliances Harm Consumers?

Buhler, Benno.

We develop a model of international roaming in which mobile network operators (MNOs) compete both on the wholesale market to sell roaming services to foreign operators and on the retail market for subscribers. The operators own a network infrastructure only in their home country. To allow their subscribers to place or receive calls abroad, they have to buy roaming services provided by foreign MNOs. We show that in absence of international alliances and capacity restrictions, competition between foreign operators would drive wholesale unit prices down to marginal costs. However, operators prefer to form international alliances in which members mutually provide roaming services at inefficiently high wholesale prices. Alliances serve as a commitment device to...

Food safety and nutritional quality – Firms’ strategies and Public intervention

Palavras-chave: International Roaming; Vertical Relations; Regulation; Industrial Organization; D43; L13; L42; L96.

Ano: 2009

URL: http://purl.umn.edu/55292

Hammoudi, Abdelhakim; Nguyen, Huong-Hue; Soler, Louis-Georges.

The aim of our paper is to determine the conditions under which firms tend to offer the best nutritional quality of food products, and the public regulation required to obtain this in a context where diet and nutritional status plays an important part in maintaining health and preventing disease, and with increasing pressure for public intervention on food quality in developed countries. To this end, we develop a duopoly model where products can be horizontally (variety) and vertically (quality) differentiated. We analyze the perfect Nash equilibriums in a two period competition game where in the first stage, the firms decide simultaneously on the variety and the quality of the product to be sold and in the second stage, firms set prices. The model...

Firm-Level Competition in Price and Variety

Palavras-chave: Nutritional product; Health cost; Public regulation; Vertical and horizontal differentiation.; Agricultural and Food Policy; Food Consumption/Nutrition/Food Safety; Industrial Organization; L13; L15; L51; Q18.

Ano: 2009

URL: http://purl.umn.edu/51749

Richards, Timothy J.; Patterson, Paul M..

Consumer product manufacturers often compete in dynamic, multi-firm oligopolies using multiple strategic tools. While existing empirical models of strategic interaction typically consider only parts of the more general problem, this paper presents a more comprehensive alternative. Marketing decision are dynamically optimal, consistent with optimal consumer choice, and responsive to rival decisions. Using a single-market case study that consists of five years of four-weekly data on ready-to-eat cereal sales, prices, and new brand introductions, we test several hypotheses regarding the nature of strategic interaction among several rival manufacturers. We find that cereal manufacturers price and introduce new brands cooperatively in the same period, but...

Tipo: Journal Article

Palavras-chave: Cereal; Differentiated products; Dynamics; Oligopoly; Product line rivalry; Strategic interaction; Demand and Price Analysis; D43; L13; L66; M31; Q13.

Ano: 2006

URL: http://purl.umn.edu/43788

Market Power and/or Efficiency: An Application to U.S. Food Processing

Lopez, Rigoberto A.; Azzam, Azzeddine M.; Liron-Espana, Carmen.

This article separates oligopoly-power and cost-efficiency effects of changes in industrial concentration and assesses their impact on output prices in 32 food-processing industries. Empirical results indicate that although concentration induces cost efficiency in one-third of the industries, oligopoly-power effects either dominate cost efficiency or reinforce inefficiency, resulting in higher output prices in most industries. The article also provides fresh econometric estimates of oligopoly power and economies of size for the industries in question.

RATIONAL INCOMPATIBILITY WITH INTERNATIONAL PRODUCT STANDARDS

Palavras-chave: Industrial concentration; Economies of scale; Industrial organization; Oligopoly power; Food processing; Agribusiness; Industrial Organization; Productivity Analysis; L00; L11; L13; L66.

Ano: 2001

URL: http://purl.umn.edu/25160

Barrett, Christopher B.; Yang, Yi-Nung.

This paper considers the incentives of firms to conform to an exogenous international product standard. Product standardization enables traditional, price-based international competition. But the existence of redesign costs or network effects creates market frictions that diminish the incentive to standardize if there already exists a different technology in an established market. This leads to multi-attribute competition between products and will generally reduce trade flows. Not only do incumbent firms using a different technology have an incentive to deviate from the international standard, but a host country government that is also concerned for the welfare of consumers who own the old technology has no incentive to enforce the international standard....

Innovation, Integration, and the Biotechnology Revolution in U.S. Seed Markets

Palavras-chave: Compatibility; International standardization; Network effects; Redesign costs; Technical barriers to trade; International Relations/Trade; F02; F13; F15; L11; L13; L51.

Ano: 1999

URL: http://purl.umn.edu/14597

Stiegert, Kyle W.; Shi, Guanming; Chavas, Jean-Paul.

Tipo: Journal Article

Palavras-chave: Crop Production/Industries; Research and Development/Tech Change/Emerging Technologies; L11; L13; L25.

Ano: 2010

URL: http://purl.umn.edu/94755

Certification of Origin and Brands Competition

Chambolle, Claire; Giraud-Heraud, Eric.

We analyse the competition in quality and quantity between a foreign firm and a domestic firm. The domestic firm can belong to a certification of origin, whereas its rival uses a pure brand strategy. We will show how the certification can allow the domestic firm to position itself as a high quality producer and improve the average quality of the products offered on the market. If, however, the certified firm offers the low quality good, the certification can permit it to guarantee a higher profit than that of its competitor and to improve the consumers' surplus by favouring product standardisation.

Footloose Capital, Market Access, and the Geography of Regional State Aid

Palavras-chave: Certification of origin; Quality; International competition; Demand and Price Analysis; L13; F12; F14.

Ano: 2002

URL: http://purl.umn.edu/24976

Ottaviano, Gianmarco I.P..

The global welfare implications of home market effects in trade models with imperfect competition are little understood. This paper proposes a simple model in which such implications can be easily analyzed. It shows an overall tendency of imperfectly competitive sectors to inefficiently cluster in locations that offer market access advantages. The more so the stronger the market power of firms as well as the intensity of increasing returns to scale and the lower the trade costs. As such features are likely to differ widely across sectors, those results provide theoretical ground to the promotion of regional policies that are also sectorspecific and not only region-specific as currently in the EU.

Market Equilibrium in the Presence of Green Consumers and Responsible Firms: A Comparative Statics Analysis

Palavras-chave: Economic integration; Specialization; Home market effect; Regional disparities; Regional policy; International Relations/Trade; Political Economy; F12; L13; R13.

Ano: 2001

URL: http://purl.umn.edu/26387

Doni, Nicola; Ricchiuti, Giorgio.

This paper analyzes how the interaction between green consumers and responsible firms affects the market equilibrium. The main result is that a higher responsibility by both producers and consumers can have different impacts on the efficiency of the firms’ abatement activity, depending on the nature of the cleaning costs. When the abatement costs are fixed, the efficiency of the clean-up effort is always increasing in their degree of responsibility. On the other hand, when the abatement costs are variable, a higher level of responsibility may reduce social welfare. Finally, the first best allocation is never reached, even in the presence of the highest credible level of responsibility of both consumers and producers.