Oligopoly Power and Allocative Efficiency in US Food and Tobacco Industries

Sanjib Bhuyan and Rigoberto Lopez

Journal of Agricultural Economics, 1998, vol. 49, issue 3, 434-442

Abstract: This paper computed oligopoly‐induced allocative efficiency losses in 38 US food and tobacco manufacturing industries using conduct, demand and cost parameters estimated with a New Empirical Industrial Organisation (NEIO) approach. Allocative efficiency loss estimates in these industries amounted to $15.2 billion or over five per cent of sales for 1987. Statistical tests showed that these losses are generally higher than previous estimates, possibly due to the allowance of non‐constant marginal costs and revised estimates of demand elasticities and conduct.

Date: 1998
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https://doi.org/10.1111/j.1477-9552.1998.tb01283.x

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Persistent link: https://EconPapers.repec.org/RePEc:bla:jageco:v:49:y:1998:i:3:p:434-442

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