Abstract
In spite of its importance to the agricultural sector, little attention has been given to the European agricultural inputs sector. This paper outlines the nature of the industrial organisation of two important constituents of this sector, the EC fertiliser and tractor industries. Specifically, the paper focusses on the prevailing market distortions in the EC fertiliser and tractor markets and the potential benefits to farmers following completion of the EC internal market in 1992. It is expected that farmers' welfare will increase following the removal of barriers to EC trade but the welfare gains will be more significant if the single market also promotes the rationalisation of these industries. However, given the structure and ownership of the fertiliser and tractor industries, it is suggested that further structural change is unlikely to occur and that the welfare gains to farmers will be limited mainly to the removal of existing non-tariff barriers in the EC.
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