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Measuring the Intensity of Competition in the Japanese Beef Market

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  • Reed, Michael R.
  • Saghaian, Sayed H.

Abstract

A residual demand model for beef exports to Japan is specified and estimated. The objective is to estimate the extent of market power. It is assumed that each exporting country faces a downward-sloping residual demand curve, which reflects the market demand minus the supplies of competitors, and that exporters maximize profit through their output decisions. The analysis is disaggregated by beef cut and form to capture the variation by beef market segments. The results indicate that the highest markup of price over marginal cost belongs to U.S. frozen ribs, the only indication of market power by U.S. exporters. Canada is found to have limited market power, whereas Australia and New Zealand enjoy some market power, including five chilled beef categories.

Suggested Citation

  • Reed, Michael R. & Saghaian, Sayed H., 2004. "Measuring the Intensity of Competition in the Japanese Beef Market," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 36(01), pages 1-9, April.
    • Handle: RePEc:ags:joaaec:42942
    DOI: 10.22004/ag.econ.42942
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    1. Gafarova, Gulmira & Perekhozhuk, Oleksandr & Glauben, Thomas, 2015. "An econometric analysis of market power in Azerbaijani wheat market: Evidence from Kazakhstan and Russia," 2015 Conference, August 9-14, 2015, Milan, Italy 211642, International Association of Agricultural Economists.
    2. Evans, Edward & Ballen, Fredy, 2014. "Assessing the Intensity of Market Competition in the US Papaya Import Market," Journal of Food Distribution Research, Food Distribution Research Society, vol. 45(2), pages 1-13, July.
    3. Gulmira Gafarova & Oleksandr Perekhozhuk & Thomas Glauben, 2023. "The Oligopolistic Behavior of Kazakh and Russian Wheat Exporters in the South Caucasus: Evidence from a Residual Demand Elasticity Analysis," Journal of Industry, Competition and Trade, Springer, vol. 23(1), pages 1-32, June.
    4. Miljkovic, Dragan & Jin, Hyun, 2006. "Import Demand for Quality in the Japanese Beef Market," Agricultural and Resource Economics Review, Cambridge University Press, vol. 35(2), pages 276-284, October.
    5. Dimitrios Panagiotou & Athanassios Stavrakoudis, 2020. "A Stochastic Frontier Analysis Approach for Estimating Market Power in the Major US Meat Export Markets," Journal of Industry, Competition and Trade, Springer, vol. 20(3), pages 569-586, September.
    6. Nakajima, Toru, 2012. "Estimating Time Variation of Market Power: Case of U.S. Soybean Exports," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124775, Agricultural and Applied Economics Association.
    7. Páll, Zsombor, 2015. "Three essays on the Russian wheat export," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 80, number 80, September.
    8. Tsaiyu Chang & Masafumi Inoue, 2013. "Market Power in the Log and Lumber Import Market in Japan," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 7(2), pages 131-146, May.
    9. Evans, Edwardv A. & Ballen, Fredy H., 2015. "Competitive Behavior in the U.S. Green Skin Avocado Market," Journal of Food Distribution Research, Food Distribution Research Society, vol. 46(3), pages 1-12, November.
    10. Iimi, Atsushi & Smith, James Wilson, 2007. "what is missing between agricultural growth and infrastructure development ? cases of coffee and dairy in Africa," Policy Research Working Paper Series 4411, The World Bank.
    11. Byung Min Soon & Wyatt Thompson, 2020. "Japanese beef trade impact from BSE using a time‐varying Armington model," Agribusiness, John Wiley & Sons, Ltd., vol. 36(3), pages 385-401, June.
    12. Crespi, John M. & Hahn, William & Jones, Keithly & Schulz, Lee L. & Chen, Chen-Ti, 2016. "A Study in U.S. Export Beef Competitiveness: Do Cattle Inventories Matter?," 2017 Allied Social Sciences Association (ASSA) Annual Meeting, January 6-8, 2017, Chicago, Illinois 250113, Agricultural and Applied Economics Association.
    13. Zhang, Qiang & Reed, Michael R. & Saghaian, Sayed H., 2007. "Export Market Pricing Decisions and Market Power in World Grain Markets: A Duopoly Model for Soybeans," 2007 Annual Meeting, February 4-7, 2007, Mobile, Alabama 34949, Southern Agricultural Economics Association.
    14. Shigekazu Kawashima & Deffi Ayu Puspito Sari, 2010. "Time-varying Armington elasticity and country-of-origin bias: from the dynamic perspective of the Japanese demand for beef imports," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(1), pages 27-41, January.
    15. Yasser S. A. Mazrou, 2015. "Does Egyptian orange exports really have a market power in Saudi Arabia market?," Asian Journal of Agriculture and rural Development, Asian Economic and Social Society, vol. 5(7), pages 167-174, July.
    16. Gafarova, Gulmira & Perekhozhuk, Oleksandr & Glauben, Thomas, 2017. "Analysis Of Oligopolistic Behaviour Of Kazakh And Russian Exporters In The South Caucasus Wheat Market," 2017 International Congress, August 28-September 1, 2017, Parma, Italy 261429, European Association of Agricultural Economists.
    17. Kawashima, Shigekazu & Sari, Deffi Ayu Puspito, 2010. "Time-varying Armington elasticity and country-of-origin bias: from the dynamic perspective of the Japanese demand for beef imports," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(01), pages 1-15.
    18. Alamri, Yosef & Saghaian, Sayed, 2016. "Measuring the Intensity of Competition among Rice Exporters to Saudi Arabia," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252678, Southern Agricultural Economics Association.
    19. Iimi, Atsushi, 2007. "Infrastructure and trade preferences for the livestock sector : empirical evidence from the beef industry in Africa," Policy Research Working Paper Series 4201, The World Bank.

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    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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