An Analysis of Pricing in the U.S. Cotton Seed Market
Kyle Stiegert () and
Jean-Paul Chavas ()
No 51617, 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin from Agricultural and Applied Economics Association
The purpose of the research in this paper is to investigate the impact of differentiated vertical strategies by agricultural biotechnology firms in the U.S. cottonseed market. The model advances the measurement of industry concentration to consider substitution/complementarity relationships among differentiated products delivered under different vertical structures. We find evidence of sub-additive pricing in the stacking of bundled biotech traits. Prices paid by farmers for cottonseed sold under vertical integration are found to be higher than under licensing. The model is flexible and allows for evaluation of the effects of changing market structures. The parameters on traditional measures of concentration indicate that higher concentration leads to higher prices. The effects of cross-market concentrations stress the need to conduct the analysis in a multi-market context.
Keywords: Agricultural and Food Policy; Demand and Price Analysis; Industrial Organization (search for similar items in EconPapers)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aaea09:51617
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