Measuring the Degree of Oligopsony Power in the Brazilian Raw Milk Market

Paulo Scalco and Marcelo Braga

International Food and Agribusiness Management Review, 2014, vol. 17, issue 2, 20

Abstract: This study sets out to measure the degree of oligopsony power in the Brazilian raw milk market. The analysis was undertaken in fifteen producing regions between January 1997 and December 2011. The results led to the authors rejecting the monopsony hypothesis. In six regions, the hypothesis of perfect competition was not rejected. In the other nine, the conduct parameter estimates were very close to zero. These results contradict both the empirical literature and the reports produced by Parliamentary Inquiries in the early 2000s, which found suspicions of market power in dairies in several Brazilian states. Although the dairy industry concentrates on the marketing of Brazilian raw milk, the survey results indicate that the behavior of firms is similar to that of a perfect competition market model.

Keywords: Agribusiness; Farm Management; Land Economics/Use; Livestock Production/Industries; Political Economy; Public Economics (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:ifaamr:167902

DOI: 10.22004/ag.econ.167902

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