Pricing Policies under Different Objectives: Implications for the Pricing Behaviour of AWB Ltd

Alexandra Lobb and Robert Fraser

No 183423, 2002 Conference (46th), February 13-15, 2002, Canberra, Australia from Australian Agricultural and Resource Economics Society

Abstract: This study is motivated by the suggestion that the objectives of the AWB Ltd have changed since semi-privatisation of the Australian Wheat Board under the Wheat Marketing Act, 1989. Conceptualising this change of objectives as a shift from revenue maximization to profit maximization, this study examines the impact of such a change on the pricing policies of a multi-market price-setting firm. More specifically, this study investigates, for two hypothetical objective functions, a risk averse firm’s price-setting behaviour in an “overseas” and a “domestic” market, given differing costs of supply, uncertain demand functions and differing price elasticities of demand in each market. The aim is to generate empirically testable hypotheses relating to the impact of a change of objectives on pricing behaviour.

Keywords: Demand and Price Analysis; International Relations/Trade (search for similar items in EconPapers)
Pages: 17
Date: 2002
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Persistent link: https://EconPapers.repec.org/RePEc:ags:aare02:183423

DOI: 10.22004/ag.econ.183423

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