Imperfect Competition Research Articles

ОСНОВНІ АСПЕКТИ РОЗРОБКИ РЕКЛАМНОЇ ПРОГРАМИ ЯК ЗАСОБУ ПРОСУВАННЯ АГЕНТСТВА НЕРУХОМОСТІ

The paper substantiates the use of promotional activities to promote services in the real estate market. The purpose of the article is to substantiate the use of advertising measures to promote an enterprise in the real estate market and their effectiveness. To identify the main trends in the development of advertising services in the real estate market. To provide practical recommendations for developing a programme of advertising activities in the real estate sector as a means of promotion in the target market. In preparing the study, a systematic approach to the study of economic processes and phenomena was used, as well as empirical (observation, description, comparison, content analysis) and theoretical (analysis, synthesis) methods of scientific knowledge. The paper studies the peculiarities of the real estate market and relevant trends in the development of advertising. The study showed that the real estate market is a structure with imperfect competition, which determines the leading role of advertising among the elements of marketing technologies. Based on the analysis of the methods of distribution of real estate advertising, it was found that online promotion tools have recently played a leading role. The marketing activities of the enterprise, its main economic indicators and the situation in the real estate market are analysed. An advertising programme was proposed for the agency. The budget of the advertising programme is calculated and the target audience is identified. It is determined that one of the most promising areas for promoting services is the social networks Facebook, Instagram. Recommendations for setting up targeted advertising are given. A visual design of banners for Facebook Ads advertising campaigns was developed. The proposed advertising programme in social networks can be considered effective and recommended for implementation by real estate agencies.

STRUCTURAL CHARACTERISTICS AND CONDUCTS OF CASHEW NUT MARKETERS IN NORTH CENTRAL ZONE, NIGERIA

This study accessed the structural characteristics and conducts of cashew nut marketers in north central zone, Nigeria. Structured questionnaires were used to collect data from 396 cashew nuts marketers selected from Kogi, Nasarawa and Kwara States; using a multi-stage random sampling technique. Various statistical tools used in assessing market performance of cashew nuts marketers: percentages, frequency, Herfindahl-Hirschman Index, Gini coefficient was used to describe the structural characteristics and conducts of cashew nut marketers while factor analysis was employed to identify major constraints militating against the marketing of cashew nut in the study area. The Herfindahl-Hirschman Index (HHI) of 0.006 implies that cashew marketing is dominated by many sellers implying perfect competition among sellers. The Gini Coefficient ratio of 0.87 implies that there is lower level of market competition (imperfect competition) among marketers in the study area and the high market power is controlled by few marketers whose actions can influence market activities in the study area because they control larger share of income/revenue in the market. Many marketers were not members of marketing association. This study also revealed that there is unavailability of source of funding among marketers thus; many marketers rely on personal saving and family saving for their business.; Cashew nut produce was differentiated into wet (at the point of sale) and dried (before sale). Majority (59.6%) of cashew nuts marketed wet nuts while 40.4% of the marketers dried their cashew nuts before selling. The major constraints militating against marketing of cashew nuts in the study area were price instability (.865), unregulated market; (.788), lack of storage facilities (.830), inadequate/unstable supply (.770), high transportation cost (.734), poor institutional support (.670) among others. This study concludes that there is no transparency in market information among cashew nuts marketers in the study area and based on this empirical finding the following recommendations were suggested: Government in collaboration with Agencies and NGOs should ensure they continue to extend their production and marketing training programs to more marketers to ensure wider coverage among beneficiaries since many of the respondents are yet to benefit from trainings and researches; marketers should be encouraged through their cooperatives to provide storage facilities that will enable them store their produce and sell when the price appreciates; Government through the extension agents with the aid of social media and cooperatives should organize training to marketers to help improve their level of knowledge on marketing and pricing that would in turn increase their marketing efficiency level; farmers should be encouraged to form cooperative in order to help them minimize the exploitation by middlemen; financial institutions, exporters, processors and donor organizations should be linked to marketers in order to assist them with fund.

A Welfare and Pass-Through Effects of Regulations within Imperfect Competition

A Welfare and Pass-Through Effects of Regulations within Imperfect Competition

Two-part trade policy in the reciprocal market model

This paper is devoted to the study of two-part trade policy for two countries, two markets, producers under imperfect competition, where the standard arguments of free trade are not applicable. The basic model is a two-step game with complete but imperfect information. The optimal policy of the government is analyzed in terms of the goals of maximizing the national welfare. This policy dominates over a simple quota and a simple tariff, which are its special cases. At the same time, the optimal two-part trade policy of governments that maximize national wealth is a subsidy.

STRUCTURAL CHARACTERISTICS AND CONDUCTS OF CASHEW NUT MARKETERS IN NORTH CENTRAL ZONE, NIGERIA

This study accessed the structural characteristics and conducts of cashew nut marketers in north central zone, Nigeria. Structured questionnaires were used to collect data from 396 cashew nuts marketers selected from Kogi, Nasarawa and Kwara States; using a multi-stage random sampling technique. Various statistical tools used in assessing market performance of cashew nuts marketers: percentages, frequency, Herfindahl-Hirschman Index, Gini coefficient was used to describe the structural characteristics and conducts of cashew nut marketers while factor analysis was employed to identify major constraints militating against the marketing of cashew nut in the study area. The Herfindahl-Hirschman Index (HHI) of 0.006 implies that cashew marketing is dominated by many sellers implying perfect competition among sellers. The Gini Coefficient ratio of 0.87 implies that there is lower level of market competition (imperfect competition) among marketers in the study area and the high market power is controlled by few marketers whose actions can influence market activities in the study area because they control larger share of income/revenue in the market. Many marketers were not members of marketing association. This study also revealed that there is unavailability of source of funding among marketers thus; many marketers rely on personal saving and family saving for their business.; Cashew nut produce was differentiated into wet (at the point of sale) and dried (before sale). Majority (59.6%) of cashew nuts marketed wet nuts while 40.4% of the marketers dried their cashew nuts before selling. The major constraints militating against marketing of cashew nuts in the study area were price instability (.865), unregulated market; (.788), lack of storage facilities (.830), inadequate/unstable supply (.770), high transportation cost (.734), poor institutional support (.670) among others. This study concludes that there is no transparency in market information among cashew nuts marketers in the study area and based on this empirical finding the following recommendations were suggested: Government in collaboration with Agencies and NGOs should ensure they continue to extend their production and marketing training programs to more marketers to ensure wider coverage among beneficiaries since many of the respondents are yet to benefit from trainings and researches; marketers should be encouraged through their cooperatives to provide storage facilities that will enable them store their produce and sell when the price appreciates; Government through the extension agents with the aid of social media and cooperatives should organize training to marketers to help improve their level of knowledge on marketing and pricing that would in turn increase their marketing efficiency level; farmers should be encouraged to form cooperative in order to help them minimize the exploitation by middlemen; financial institutions, exporters, processors and donor organizations should be linked to marketers in order to assist them with fund

ВЛИЯНИЕ ОТРАСЛЕВОЙ НЕСОВЕРШЕННОЙ КОНКУРЕНЦИИ НА ПЕРЕДАЧУ ЭКОНОМИЧЕСКИХ ШОКОВ СО СТОРОНЫ СПРОСА В КОММЕРЧЕСКИХ ВЗАИМОДЕЙСТВИЯХ «ЗАТРАТЫ – ВЫПУСК»

The article considers the model of imperfect competition, which allows to reveal the impact of economic shocks on commercial companies interconnected by the flows of manufactured products according to the “input – output” model. A theoretical model of the relationship between two types of companies in two industries with hierarchical relationships has been developed. Theoretically and experimentally, the relationship between the price index, the number of companies in the industry and the demand function with the elasticity of demand, the number of companies’ products, the exchange rate of the domestic currency against foreign currency is presented. The impact of an economic shock in the form of a sharp and unexpected exchange rate of the domestic currency on the elasticity of demand, the number of companies in the industry, and the volume of output by companies is presented. Empirical results support the theoretical model.

The impact of anti-Russian sanctions on the export of Kazakhstan’s oil

On the basis of the conducted study of the peculiarities of the state policy of the oil refining industry, it has been determined that the oil refining industry occupies a significant part of the country’s fuel and energy complex, providing for the needs of the economy of the Republic of Kazakhstan. At the same time, in the conditions of the global economy, Kazakhstan's oil-producing industry is experiencing problems due to anti-Russian sanctions, which make it difficult to implement the national policy of overcoming the raw orientation of the export of oil and oil products. The very fact of the presence of anti-Russian sanctions forms the field of intensifying competition between Russia and Kazakhstan in the European energy market and creates conditions for the use of methods of imperfect competition, for the use of political instruments in solving economic problems. This situation has a negative impact on the development of the oil production industry in both Russia and Kazakhstan, and requires its resolution, which becomes possible when the Kazakh oil sector moves to an innovative model of development based on the intensification of oil refining. Sanctions against Russia create significant difficulties due to the fact that Kazakhstan uses Russian transport infrastructure to trade with European Union countries. Therefore, the Republic of Kazakhstan needs to strive to reduce economic costs by insuring the transportation process of exported goods and subsidizing some additional costs. Kazakhstan is taking the initiative in mediating between the countries, trying to maintain relations with Russia through diplomacy, which it has conducted so far, as well as coping with the economic difficulties and political pressure that the country is facing in a balanced way. Thus, Kazakhstan continues its traditional multi-vector foreign policy strategy. Of course, the most effective and comprehensive solution for Kazakhstan, as well as for all countries in the region, is to end the war in Ukraine as soon as possible.

Теория хаоса: расширение границ экономических исследований

The application of chaos theory in economics is associated with an increasing level of uncertainty and external shocks faced by economic systems. This article reviews and systematizes the approaches to the use of chaos theory in economic research. To this end, we discuss the concept of chaos and its relevance; and identify those areas of research for which the application of chaos theory holds most promise. The research methodo­logy comprises methods of system-functional and system-historical analysis. These methods are used to analyze the content of publications devoted to the application of chaos theory to study price fluctuations in individual markets, the behaviour of firms in the conditions of imperfect competition, the analysis of uncertainty of consumer behaviour, as well as cyclical economic development and disequilibrium associated with the ba­lance of unemployment and inflation and geopolitical tensions. The study draws the distinction between the concepts of synergetics and chaos theory. It is shown that although these two research areas are related, they have a different focus of application. The study also identifies some common patterns in the use of chaos theory tools for economic research: at the first stage, elements of chaos, fractals and nonlinearity in the series of economic data are identified; at the second stage, researchers try to explain certain events by using the tools of chaos theory; and at the third stage, chaos theory is used to model and subsequently predict short-term and long-term trends. Chaos theory expands the mathematical apparatus of economic research, allowing researchers to access tools from the field of physics and other natural sciences, which enhances interdisciplinary synthesis.

Network Games of Imperfect Competition: An Empirical Framework

Network Games of Imperfect Competition: An Empirical Framework

Інфляція в системі суспільно-економічних відносин

The article examines the essential features, deep causes and main forms of inflation as a multifactorial phenomenon that inevitably accompanies the economic development of almost all countries of the world. It is shown that the sources and consequences of inflation are not only of a monetary nature, but rather are deeply rooted in structural problems and affect directly and indirectly the totality of social relations. It is noted that the nature of inflation is rooted in the social conflict regarding the distribution of the social product between different social groups of the society. It is justified that inflation itself is complex and heterogeneous in its causes of origin, general features of the inflationary process, its mechanism of action, and consequences. It is argued that inflation is a monetary phenomenon, as it is caused by an excess of money in circulation. However, it should be noted that non-monetary factors can also be the cause of inflation. Regardless of the area in which inflation originates – monetary or non-monetary – monetary and non-monetary factors are interdependent, as they interact in a reproductive process. It is emphasized that one of the driving forces of the inflationary mechanism is the unevenness of price increases, as a result of which some economic subjects are interested in the existence of inflation. It is found that the nature of the national economy and the market has a significant impact on the inflationary process. The dominance of monopolistic structures of the economy, the majority of imperfect competition in the markets is a favorable environment in which inflationary tendencies are quite easily picked up and become strengthened. It is identified that inflationary processes of the national economy can also arise as a result of international exchange, through the price mechanism of foreign trade, when the increase in the price of imported resources creates an impulse for inflationary costs within the country.

Search Theory of Imperfect Competition with Decreasing Returns to Scale

Search Theory of Imperfect Competition with Decreasing Returns to Scale

The Economics of a "portion size reduction" policy.

This study develops novel models of heterogeneous consumer preferences for different dining options and imperfect competition among food suppliers to analyze the market and welfare effects of portion size reduction (PSR) for food away from home. Different scenarios on the nature of differentiation of the dining options, the information available to consumers, and their response to links between portion size and obesity, food waste, and climate change are considered within this framework. The market and welfare effects of the policy are quantified using a simulation analysis. The analysis shows that the market and welfare effects of the policy are case-specific and dependent on the relative magnitude of the cost and utility effects of PSR, the strength of the consumer preference for dining out, and the food suppliers' initial costs and degree of market power in the relevant markets. The policy can create winners and losers among consumers and accounting for consumer heterogeneity, as done in this study, is essential for capturing the asymmetric welfare effects of PSR. Intriguingly, consumers and suppliers can benefit from PSR even without accounting for any health or/and environmental benefits of reduced portion sizes.

Market Power in Manufacturing and Services Industries

This study analyzes the extent of the market power of the manufacturing and services industries in Portugal over the last decade. The results show that Portuguese industries are mostly operating under imperfect competition. Mark-ups are heterogeneous across industries, with services having higher mark-ups on average than manufacturing. The apparel and the administrative activities industries have the highest mark-ups; in turn, the food and the beverages industries have the lowest mark-ups, while the rubber and plastics industry seems to operate under competitive conditions. There is therefore room for improving product market competition in Portugal.

Pooling problems under perfect and imperfect competition

We investigate pooling problems in which multiple players vie with one another to maximize individual profit in a non-cooperative competitive market. This competitive setting is interesting and worthy of study because the majority of prevailing process systems engineering models largely overlook the non-cooperative strategies that exist in real-world markets. In this work, each player controls a processing network involving intermediate tanks (or pools) where raw materials are blended together before being further combined into final products. Each player then solves a pure or mixed-integer bilinear optimization problem whose profit is influenced by other players. We present several bilevel formulations and numerical results of a novel decomposition algorithm.

A Conceptual Analysis of Equilibrium Bidding Strategy in a Combined Oligopoly and Oligopsony Wholesale Electricity Market

This paper proposes a semi-analytical method to obtain the equilibrium bidding strategies for generation and demand units in a <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">combined</i> oligopoly and oligopsony wholesale electricity market. Such market structure is the outcome of the increasing deployment of demand response programs that facilitate <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">active participation of demand-side players</i> in the price-setting process. In this analysis, the concept of supply function equilibrium (SFE) is used to investigate the oligopolistic competition among generation units. The SFE model is extended and the demand function equilibrium (DFE) is obtained to study the oligopsonistic competition among demand units. The economic behavior of a market participant is formulated as a bi-level programming (BLP) problem. The <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">imperfect competition</i> among generation units, as well as among demand units, are modeled as a non-cooperative game. Next, a direct method is developed to calculate all candidate equilibriums of the market, and the locational marginal prices (LMPs) in terms of the bidding strategies of the market participants. The BLP problem is solved by obtaining the coordinated Pareto-dominant Nash equilibrium of the market participants’ non-cooperative games. Finally, the proposed analysis is examined in case studies. Accordingly, we report <italic xmlns:mml="http://www.w3.org/1998/Math/MathML" xmlns:xlink="http://www.w3.org/1999/xlink">insightful observations</i> with respect to the impact of the changes in the new market structure, at firm-level and market-level, such as in terms of mitigating market power of generation units, the market clearing prices and quantities, surplus for generation units and demand units, and potential impact on market efficiency.

The CO2 cost pass-through in nonlinear emission trading schemes

In this paper, we theoretically study the issues that how nonlinear structures of energy market affect CO2 costs of energy firms being passed through to energy prices in emission trading schemes. We set up oligopoly models to investigate CO2 cost pass-through under different emission right allocations, characterize analytic derivations of CO2 cost pass-through rates and then explore the connections between CO2 pass-through rates and nonlinear market structures. Our findings suggest that the CO2 cost pass-though rates are not only dependent on the elasticities of energy demand and supply, but largely determined by the convexity of demand curve and the competition intensity of energy market. More importantly, an economic curiosity (CO2 cost pass-through overshifting) is also observed in the emission trading schemes under suitable market conditions. The existence of CO2 cost pass-through overshifting provides regulators and policy makers important information that the emission trading schemes are at the risk of imperfect competition and may require further policy adjustments.

Identifying market power of retailers and processors: Evidence from coffee supply chain in India

This paper deals with the dynamics of market power with processors and retailers in the coffee supply chain in India. We develop an imperfect competition model that allows for the potential oligopoly and/or oligopsony power of retailers and processors with respect to adjacent stakeholders in the supply chain. We also empirically determine the presence/absence of market power among processors and retailers in the coffee supply chain in India. This paper highlights the existence of market power with processors in the coffee industry that plays an important role in the imperfect price transmission and should not be ignored when developing regulatory policies.

Pipes, Trains and Automobiles: Explaining British Columbia’s High Wholesale Gasoline Prices

I modify a coumot oligopoly model to examine the effect of pipeline capacity constraints on regional wholesale gasoline prices. The model includes a discontinuous supply function for a common input (transportation) with a constrained low-cost mode (pipelines) and an unconstrained higher cost mode (rail, truck or barge). The equilibrium outcome demonstrates a piecewise linear relationship between the low-cost capacity constraint and the equilibrium price. The shape of the transportation supply curve is also shown to affect the relationship between firm average marginal costs and the equilibrium price. I also present a test of the model’s implications, demonstrating that it is able to explain a recent pronounced increase in wholesale gasoline prices for cities in British Columbia Canada. While the exercise is motivated by a specific market, the model and its implications apply to a broad set of discussions on inter-regional arbitrage in the context of imperfect competition.

Aspects of import substitution in the mining and processing industry

There are at least two aspects to the import substitution policy in mining and processing and related industries. One is related to the forced restriction of international competition, the growing share of imperfect competition, costs in the form of lower overall product quality, higher prices, and potentially higher corruption. The other implies wider possibilities for domestic equipment and technology designers and suppliers, ensuring independence and stability in the basic sectors of the economy. The possible import substitution mechanisms include:&mdash; direct import substitution with products designed and manufactured domestically;&mdash; joint manufacture with high localization (70&ndash;80 %);&mdash; parallel import through alternative suppliers;&mdash; reorientation to alternative suppliers.According to expert assessments, rapid import substitution is deemed impossible only for a few critical groups of equipment, including high-power electric motors, ore mills of the largest standard sizes, and high-pressure grinding rolls. The supply of these machines for new or reconstructed processing plants seems highly problematic. As regards the above-mentioned mills, this type of equipment has a very long life cycle and mainly requires the supply of replacement parts. In general, Russian manufacturers are able to reliably cover the demand for all basic mineral processing equipment, with the exception of three or four types of custom high-performance solutions. In the field of laboratory equipment for mineral raw materials, domestic enterprises supply all types of equipment required by the industry.The study was carried out under the grant issued by the Russian Science&nbsp;Foundation (project No. 20-79-10125).

Agriculture, food and global value chains: issues, methods and challenges

Agriculture, food and global value chains: issues, methods and challenges