Using threshold co-integration to estimate asymmetric price transmission in the Turkish milk market

We investigate the price dynamics between retail milk price and raw milk price in the Turkish fluid milk market. The study uses monthly fluid milk prices for 14 years between January 2003 and December 2016. We analyze the price adjustment in the fluid milk market through an asymmetric error correction model with threshold co-integration. We find that the transmission between the two prices has been asymmetric in both the long term and short term period. Differences between the farm milk prices and retail milk prices may exist due to marketing costs across the supply chain and pricing policies associated with the market structure. Results of the long-run analysis indicate a significant market power in the fluid milk market. Therefore, in this asymmetric case, the deviations are likely to be the reason for the market power of the processors/retailers and the reason for the oligopolistic market structure in the sector.

Die Oberschlesische Kohlenkonvention – eine «kleine Familienvereinigung»?

The Upper Silesian Coal Convention – a «family affair»?This article presents new evidence on the Upper Silesian Coal Convention, a coal-mining cartel in Upper Silesia, in existence from 1898 to 1925. The cartel had evolved from collusive agreements dating back to 1890 and accounted for approximately one fourth of Germany’s coal supply. Yet, market coverage and longevity of the convention, as well as the economic importance of the Upper Silesian industrial district in general, imply that this cartel has been understated in historical research so far. Aristocratic industrialists, the leading group of entrepreneurs in Upper Silesia, shaped the formation and operation of the cartel. They induced an oligopolistic market structure and social homogeneity among cartel members that facilitated cartel formation in Upper Silesia.

Performance of Soybean Marketing in Emby, Tharaka Nithi and Meru Countries, Kenya

Current demand for soybean in Kenya exceeds supply despite numerous efforts by the government to increase production. Soybean farmers are faced with the difficulty in accessing the market reason for their reluctance in producing. Little is known about the soybean market in the central highlands of Kenya. This study was carried out with the aim to assess the structure conduct and performance of soybean markets in EmbuTharaka-Nithi and Meru Counties. Key informant interviews were carried out among soybean farmers’ groups, Ministry of Agriculture Livestock and Fisheries and soybean processing companies. A structured questionnaire was administered to processors, wholesalers, retailers and assemblers of soybean. Data was collected mainly on characteristics of respondents and marketing information. The collected data were used to calculate Herfindahl Hirschman Index (HHI), gross margins, marketing margin, and marketing efficiency. The results of the study showed that there were eight important marketing channels with channel 1 being the most efficient followed by channel 7, 3, 8, 4, 2, 6 and 5 respectively. The HHI showed that wholesalers were competitive (0.0997); retailers were relatively competitive (0.1701) while processors indicated an oligopolistic market structure with an HHI index of 0.18. Farmers groups, wholesalers and assemblers sold their soybean to processors at a fixed price (60ksh) given by the processors. Quantities traded were low with an average of 333.3kg for wholesalers, 793.33kg for assemblers and 47kg for retailers. There were no trader associations in the study area even though farmers engaged in group marketing. The study concluded that Constraints to marketing by farmers included low prices, lack of processing equipment’s, inadequate marketing arrangements, and high cost of processing.

Fast Food Industry Growth in China

Over the last decade, fast food industries in china have dramatically increased. Several international enterprises have moved and expand their brands in china markets and trade-holders since 1990. This paper discusses the Chinese fast food consumption and supply and will give account to the factors affecting it favorably like the increase in household income, changes in Chinese lifestyle, growth in population size, emergence of many foreign brands and players, technological advancement, and the introduction of franchising regulations. It will also highlighted on the increasing health concerns, which could possibly affect the Chinese fast food consumption and supply in the longer run. The paper also talk about the elasticity of demand and how the availability of many substitutes will make demand highly elastic in the Chinese fast food industry, which shall imply that any slight change in prices of fast food products by any company will affect demand for that company’s product adversely to other substitutes / company products. Finally, we discuss the Chinese fast food non-collaborative oligopolistic market structure.

Oligopolistic Competition among Providers in the Telecommunication Industry: The Case of Slovakia

The issue of the paper is devoted to the oligopolistic market structure, which is a popular form of imperfect competition occurring in the current market economies. The main aim of the paper is to quantify the selected oligopolistic structure of the telecom industry in the Slovak market in the period 2013–2017. We subjected the oligopoly to concentration analysis of the market to quantify and assess the competitive environment in which mobile providers are operating. Market concentration was measured while using specific indicators of market concentration CR2, CR3, the Herfindahl-Hirschman Index, Lorenz curve, Gini coefficient, and coefficient of variation, using the information on total revenues of operators, the share of mobile operators on total revenues, number of active customers, and the penetration of SIM cards. The calculated values of the selected market concentration indices in the telecom sector proved that the mobile operators market is highly concentrated. The services that are offered by operators are not identical, and they are differentiated based on price, quality, availability, or the target group of customers. We also identified the entry barriers, which can be categorized to strategic, economic, technical, and time barriers. The Slovak telecom sector is an oligopoly where competitors offer slightly differentiated products; however, the competitive environment in which they operate is highly concentrated and competition needs to be regulated to achieve the sustainable development of the telecommunication sector.

GLOBAL CONCENTRATION OF PULP EXPORTS

This study analyzed the evolution and degree of the global concentration of pulp exports from 1961 to 2014. In order to measure and analyze the concentration, the following indicators were used: Concentration Ratio [CR(k)]; Herfindahl-Hirschman Index (HHI); Theil Entropy Index (E); Hall and Tideman Index (HTI); Comprehensive Concentration Index (CCI); and Gini Coefficient (G). We concluded that there was a tendency of growth in the global pulp exports during the analyzed period due to an increase in demand driven by population growth and to per capita consumption, enhancing the increase in the number of exporting countries. The CR(k) of the global pulp exporting countries showed that the four [CR(4)] and eight [CR(8)] largest countries present a high concentration, with an oligopolistic market structure and competitive advantage. About 100% of exports are dominated by the 20 largest countries [CR(20)]. The HHI, E, HTI, and CCI indicators showed that there is a concentration in global pulp exportation and presented a deconcentrating tendency. Despite the increase in the number of exporting countries, there was no significant reduction in the inequality of global pulp exports. According to the Gini Coefficient, the inequality was strong to absolute.

Swasembada Beras Berkelanjutan: Dilema antara Stabilisasi Harga dan Distribusi Pendapatan

<p>Like other Asian countries, Indonesia tries to achieve rice self-sufficiency. To improve farmers’ competitiveness through agricultural investment and infrastructure, the government intervenes the rice market through subsidies, tariff import, and other support mechanisms for domestic producers. These interventions aims to improve farmers’ welfare and to maintain retail price. Rice is a staple food and it also has social and economic roles. Furthermore, rice is a political good. Rice self-sufficiency makes the country look improved and developed. The government takes measures to achieve rice self-sufficiency. The study aims to review rice policy implementation along with the self-sufficiency achievement by elaborating policy intervention and its implication in the market. Results of the study showed that involvement of state-owned companies in rice market could minimize market failure, but it encouraged an oligopolistic market structure and biased rice policy toward certain interest group. Shifting orientation of rice policy from price stabilization to income distribution might encourage a better rice market toward sustainable rice self-sufficiency.</p><p> </p><p>Abstrak</p><p>Indonesia hendak mencapai swasembada pangan khususnya beras sebagaimana negara Asia yang lain. Dalam rangka mendorong daya saing petani melalui investasi dan infrastruktur pertanian, pemerintah melakukan intervensi pasar beras melalui beragam subsidi, tarif, dan mekanisme bantuan lain untuk produsen domestik. Intervensi ini pada dasarnya bertujuan untuk meningkatkan pendapatan produsen dan menjaga stabilitas harga di tingkat konsumen. Beras tidak saja berperan sebagai bahan makanan semata, melainkan juga mempunyai peran sosial dan ekonomi di dalam masyarakat. Peran tersebut membuat beras jauh lebih penting dibandingkan bahan pangan yang lain. Keyakinan bahwa dengan swasembada beras membuat negara tampak unggul dan maju. Oleh karena itu, berbagai kebijakan beras diimplementasikan guna mencapai target swasembada. Kajian ini bertujuan untuk mengkaji ulang implementasi kebijakan perberasan dalam rangka pencapaian swasembada dengan menelaah intervensi kebijakan beserta implikasinya terhadap pasar. Hasil menunjukkan bahwa keterlibatan Badan Usaha Milik Negara di dalam pasar beras dapat mengurangi kegagalan pasar, meskipun keberadaannya membuat struktur pasar cenderung oligopolistik dan kebijakan beras menjadi bias kepada kelompok kepentingan tertentu. Pergeseran orientasi kebijakan beras dari stabilisasi harga ke distribusi pendapatan memungkinkan ke arah pasar beras yang lebih baik menuju swasembada beras yang berkelanjutan.</p>

Economising, Strategising and the Vertical Boundaries of the firm

We bridge the organisational economics and industrial economics literatures on the vertical boundaries of the firm by contextualising the transaction cost approach to the make-or-buy decision within an oligopolistic market structure. Firms invest in the quality of the intermediate resulting in the endogenous determination of the price of the intermediate and marginal production cost of the final good. We highlight new strategic incentives to outsource and/or vertically integrate and show how these incentives can result in asymmetric-mode-of-operations, investment and costs. We apply our model to a number of different international trading setups.