ELASTICITY OF SUPPLY AND THE INCENTIVE FOR COLLUSIVE BUYING

Roley R. Piggott

Australian Journal of Agricultural Economics, 1970, vol. 14, issue 2, 7

Abstract: A model is developed to show how changes in the elasticity of the supply function at the farm level offset increased levels of buyer (processor) concentration such that given percentage increases in demand by large buyers result in the same, or smaller, percentage price changes than do increases in demand on the part of small buyers. Since the incentive for collusive buying is a function of the potential price increases which follow demand increases, there may be little incentive for buyers to collude even if they are highly concentrated.

Keywords: Demand; and; Price; Analysis (search for similar items in EconPapers)
Date: 1970
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Persistent link: https://EconPapers.repec.org/RePEc:ags:ajaeau:22409

DOI: 10.22004/ag.econ.22409

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