Spatial Pricing and the Location of Processors in Agricultural Markets

Marten Graubner, Alfons Balmann () and Richard J. Sexton

No 114601, 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland from European Association of Agricultural Economists

Abstract: Spatially dispersed production and processing, endemic for most agricultural or renewable resource markets, causes oligopsonistic competition. The possibility and use of spatial price discrimination in these markets is well documented. It is also well known that the location of processors relative to competitors crucially affects the intensity of competition. However, insights regarding the relation between spatial price discrimination and the spatial differentiation of firms are barely present because the simultaneous investigation of these issues is often intractable analytically. We use computational economics to study these problems under a general theoretical framework. For instance, we show whether and under which conditions firms choose to differentiate their locations and/or price strategies. Results are consistent with observations in agricultural markets.

Keywords: Agribusiness (search for similar items in EconPapers)
Pages: 17
Date: 2011
New Economics Papers: this item is included in nep-com and nep-geo
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaae11:114601

DOI: 10.22004/ag.econ.114601

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