Abstract
While high transportation cost and market power are long-recognized sources of market inefficiency, their analytical relation has not been established in a developing country context. In this paper, we analyze the mechanism by which lower transportation costs increase farm prices and profits by reducing marketing costs and marketing firms' exercise of oligopsony power. We utilize a two-stage game framework to demonstrate use of an endogenous financing mechanism to generate funds to improve transportation infrastructure and derive the optimal rate of taxation to maximize producer welfare.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
