Revisiting concentration in food and agricultural supply chains: The welfare implications of market power in a complementary input sector

Metin Çakir, James Nolan

Research output: Contribution to journalArticlepeer-review

5 Scopus citations

Abstract

We explore how market power in a complementary input sector compares to that in a downstream sector for producer and consumer welfare. We develop a model of a homogeneous product market encompassing bilateral and complementary relationships. Our main finding is that market power exercised by the supplier of a complementary input generates greater negative welfare effects than the same level of market power exercised by downstream firms. We provide a discussion of the implications of the results for policy in the context of current problems in the Canadian grain-handling and transportation system.

Original languageEnglish (US)
Pages (from-to)203-219
Number of pages17
JournalJournal of Agricultural and Resource Economics
Volume40
Issue number2
StatePublished - May 1 2015

Keywords

  • Complementary sectors
  • Grain handling
  • Market power
  • Supply chain competitiveness
  • Transportation

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