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EU harmonisation of regulations and mark-ups in the Dutch food industry

M. Vancauteren

European Review of Agricultural Economics, 2013, vol. 40, issue 1, 163-189

Abstract: This paper studies the effect of EU harmonisation of food regulations on time-varying, firm-heterogeneous mark-ups using data on Dutch food-processing firms during 1992–2005. EU product standard harmonisation is measured using data at the 8-digit combined nomenclature product level. EU harmonisation generates short- and long-run pro-competitive effects: on average, an increase of 50 per cent in the sales-weighted coverage ratio of EU harmonisation leads to a decrease in mark-ups of 7 per cent after 1 year and by 11.5 per cent in the long-run. By taking account of firm heterogeneity, I show that this pro-competitive effect is more pronounced for (i) small firms, (ii) more concentrated firms, (iii) single-product firms, (iv) firms belonging to food sub-sectors which are less affected by EU harmonisation and (v) during the first half of the sample period. , Oxford University Press.

Date: 2013
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European Review of Agricultural Economics is currently edited by Timothy Richards, Salvatore Di Falco, Céline Nauges and Vincenzina Caputo

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