Testing for Oligopoly and Oligopsony Power

Azzeddine Azzam and Emilio Pagoulatos

No 115906, Working Papers from Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance

Abstract: This paper extends the conjectural approach in industrial organization to the analysis of imperfections in output and factor markets simultaneously. Starting from the specification of a production function, the econometric analysis is based on the formulation and estimation of a simultaneous equation model consisting of a production function, first order conditions associated with factor employment, and two conjectural elasticities to parametrize the industry's oligopoly and oligopsony equilibria. As an example, we provide an application to the U.S. meat packing industry. Our results suggest that the industry excercised market power in both the output (meat) market and the factor (live animals) market.

Keywords: Industrial; Organization (search for similar items in EconPapers)
Pages: 23
Date: 1989-09
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:ags:rpspwp:115906

DOI: 10.22004/ag.econ.115906

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