Buyer Power and Product Innovation: Empirical Evidence from the German Food Sector

Christoph Weiss and Antje Wittkopp

No 303, FE Working Papers from Christian-Albrechts-University of Kiel, Department of Food Economics and Consumption Studies

Abstract: Substantial increases in retail concentration (particularly in Europe) raise concerns about the welfare implications for consumers. In a formal model, we argue that retailer market power reduces upstream firms incentives to introduce new products. On the basis of a survey of firms in German food manufacturing, the results of a negative binomial regression model supports the proposition of a detrimental effect of retailer market power on product innovations. This effect is mitigated if manufacturing firms also have some market power (countervailing power). Innovations are positively related to firm?s market share in food manufacturing.

Keywords: Retailer market power; product innovation; food manufacturing (search for similar items in EconPapers)
JEL-codes: L1 L66 O31 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:caufew:0303

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