Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/74915
Authors: 
Kaditi, Eleni A.
Year of Publication: 
2011
Series/Report no.: 
LICOS Discussion Paper 273
Abstract: 
This paper examines whether ownership and increased competitive pressure affect food retailers' market power, analysing whether all actors involved in the food supply chain deviate from the pricing behaviour that exists under perfect competition. A method proposed by Roeger (1995) is used to estimate price-cost margins, relaxing the assumptions of perfect competition and constant returns to scale. The obtained results show that foreign investments and consolidation have a positive and significant impact on the market power of food processors and retailers. Food processors, agricultural producers and wholesalers have lower price-cost margins than retailers, which suggests that these actors price closer to marginal costs being more concerned with maximising social welfare or that the firmer have higher costs than retailers. The results are robust to various estimation techniques and specifications.
Subjects: 
Price-cost mark-ups
multinational firms
retailing
JEL: 
F23
L13
L81
Document Type: 
Working Paper

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