Abstract
Research background: The analysis of the competitiveness between producers, processors and retailers in food supply chains has always been drawing a high level of attention. It has become even more topical issue for researchers and policymakers after the global food crisis in 2008. Purpose of the article: The goal of this paper is to analyse empirical studies of market power and to investigate if some supply chains are systematically more prone to excessive market power than others. Methods: For this study, we have collected a wide range of recent studies investigating the processors’ market power index in the food supply chains. In total, in our analysis, we used 472 unique market power index estimates and employed various linear regression models to investigate their determinants. Findings & Value added: Our findings suggest that, on average, the reported degree of market power in the USA is almost twice as high as in other countries. At the same time, market power estimates related to the meat, dairy and horticulture industries are systematically higher than the ones related to other supply chains. Finally, we observed that, on average, supply chains related to highly perishable products tend to have lower market power estimates associated with them, than other supply chains. Our results have important implications for future investigation of the structural source of market power and unfair trade practices.
Highlights
Analysis of the market power (MP) along food supply chains have a long history in economic literature and it was becoming even more discussable during the last few decades due to the specific development of producer and consumer prices
Even though that there were plenty approaches developed, the range of methods used empirically can be summarised to three main methods: Production-Theoretic Approach (PTA), General Identification Method (GIM) and Stochastic Frontier Estimation (SFE) framework
The second model (2) contains all the variables from the first and variables related to data frequency of and geographical information of the Market Power Index (MPI)
Summary
Analysis of the market power (MP) along food supply chains have a long history in economic literature and it was becoming even more discussable during the last few decades due to the specific development of producer and consumer prices. Even though that there were plenty approaches developed, the range of methods used empirically can be summarised to three main methods: Production-Theoretic Approach (PTA), General Identification Method (GIM) and Stochastic Frontier Estimation (SFE) framework. Each of these approaches has its strengths and weaknesses; describing this is beyond the scope of this paper. Their main drawback is that even though an estimate for the market power is obtained, the source of the market power is not identified, which limits the explanatory power of these models
Sign-in/Register to view highlights & summary 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.
