IDEAS home Printed from https://ideas.repec.org/a/bla/jageco/v50y1999i1p64-82.html
   My bibliography  Save this article

Scale Effects and Mark‐ups in the US Food and Fibre Industries: Capital Investment and Import Penetration Impacts

Author

Listed:
  • Catherine J. Morrison Paul

Abstract

Capital investment patterns and import penetration are often alleged to influence firms' costs and prices, and thus economic performance. We examine the impacts of these factors on measures of scale economies, input demand/composition, and market power in the US food and fibre industries. Flexible variable cost functions incorporating quasi‐fixity of three categories of private (internal) capital and two external technological and trade (import) factors represent the cost structures of the two industries. Pricing equations, based on inverse demand functions including import prices, represent output decisions. Cost and demand elasticities constructed from this model indicate reduced manufacturing costs from technical and trade, scale and capital effects. This increased cost efficiency arises largely from materials savings in the textiles industry and reduced labour use in the food industry. Mark‐up behaviour is exhibited for most of the sample period in the textiles industry, and neither industry appears heavily affected by import prices.

Suggested Citation

  • Catherine J. Morrison Paul, 1999. "Scale Effects and Mark‐ups in the US Food and Fibre Industries: Capital Investment and Import Penetration Impacts," Journal of Agricultural Economics, Wiley Blackwell, vol. 50(1), pages 64-82, January.
    • Handle: RePEc:bla:jageco:v:50:y:1999:i:1:p:64-82
    DOI: 10.1111/j.1477-9552.1999.tb00795.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1477-9552.1999.tb00795.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1477-9552.1999.tb00795.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Kuo S. Huang, 1991. "Factor Demands in the U.S. Food-Manufacturing Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 73(3), pages 615-620.
    2. Shangnan Shui & John C. Beghin & Michael Wohlgenant, 1993. "The Impact of Technical Change, Scale Effects, and Forward Ordering on U.S. Fiber Demands," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 75(3), pages 632-641.
    3. Berndt, Ernst R. & Morrison, Catherine J., 1995. "High-tech capital formation and economic performance in U.S. manufacturing industries An exploratory analysis," Journal of Econometrics, Elsevier, vol. 65(1), pages 9-43, January.
    4. Barry K. Goodwin & Gary W. Brester, 1995. "Structural Change in Factor Demand Relationships in the U.S. Food and Kindred Products Industry," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 77(1), pages 69-79.
    5. V. N. Balasubramanyam & D. T. Nguyen, 1991. "Structure And Performance Of The Uk Food And Drink Industries," Journal of Agricultural Economics, Wiley Blackwell, vol. 42(1), pages 56-65, January.
    6. Tim Hazledine, 1991. "Productivity in Canadian Food and Beverage Industries: An Interpretive Survey of Methods and Results," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 39(1), pages 1-34, March.
    7. Robert C. Feenstra, 1996. "U.S. Imports, 1972-1994: Data and Concordances," NBER Working Papers 5515, National Bureau of Economic Research, Inc.
    8. Susanto Basu, 1996. "Procyclical Productivity: Increasing Returns or Cyclical Utilization?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(3), pages 719-751.
    9. Eli Berman & John Bound & Zvi Griliches, 1994. "Changes in the Demand for Skilled Labor within U. S. Manufacturing: Evidence from the Annual Survey of Manufactures," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(2), pages 367-397.
    10. Morrison, Catherine J, 1988. "Quasi-Fixed Inputs in U.S. and Japanese Manufacturing: A Generalized Leontief Restricted Cost Function Approach," The Review of Economics and Statistics, MIT Press, vol. 70(2), pages 275-287, May.
    11. Bartel, Ann P & Lichtenberg, Frank R, 1987. "The Comparative Advantage of Educated Workers in Implementing New Technology," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 1-11, February.
    12. Burnside, Craig, 1996. "Production function regressions, returns to scale, and externalities," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 177-201, April.
    13. Sanjib Bhuyan & Rigoberto A. Lopez, 1997. "Oligopoly Power in the Food and Tobacco Industries," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 1035-1043.
    14. Morrison, Catherine J, 1985. "Primal and Dual Capacity Utilization: An Application to Productivity Measurement in the U.S. Automobile Industry," Journal of Business & Economic Statistics, American Statistical Association, vol. 3(4), pages 312-324, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ollinger, Michael, 2009. "The Cost of Food Safety Technologies in the Meat and Poultry Industries," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 48783, Agricultural and Applied Economics Association.
    2. Unterschultz, James R. & Jeffrey, Scott R. & Quagrainie, Kwamena K., 2000. "Value-Adding 20 Billion By 2005: Impact At The Alberta Farm Gate," Project Report Series 24049, University of Alberta, Department of Resource Economics and Environmental Sociology.
    3. Rahman, Mohammad Chhiddikur, 2020. "Welfare Impact of Asymmetric Price Transmission on Bangladesh Rice Consumers," EconStor Theses, ZBW - Leibniz Information Centre for Economics, number 242248, September.
    4. Hossain, Ferdaus & Jain, Ruchi, 2001. "Financial Structure, Production and Productivity Growth in U.S. Food Manufacturing Industry," 2001 Annual meeting, August 5-8, Chicago, IL 20756, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Ian Sheldon & Richard Sperling, 2003. "Estimating the Extent of Imperfect Competition in the Food Industry: What Have We Learned?," Journal of Agricultural Economics, Wiley Blackwell, vol. 54(1), pages 89-109, March.
    6. Theofanis Papageorgiou & Panayotis G. Michaelides & John G. Milios, 2011. "Technology and economic fluctuations in the US food sector (1958‐2006)," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 38(2), pages 140-164, January.
    7. Ollinger, Michael, 2008. "Structural Change in the Meat and Poultry Industry and the Pathogen Reduction Hazard Analysis Critical Control Point Rule," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 36747, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Morrison Paul, Catherine J. & Siegel, Donald, 1997. "Automation Or Openness?: Technology And Trade Impacts On Costs And Labor Composition In The Food System," Strategy and Policy in the Food System: Emerging Issues, June 20-21, 1996, Washington, D.C. 25940, Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance.
    2. David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1998. "Computing Inequality: Have Computers Changed the Labor Market?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1169-1213.
    3. Jorge Saba Arbache, 2001. "Trade Liberalisation and Labor Markets in Developing Countries: Theory and Evidence," Studies in Economics 0112, School of Economics, University of Kent.
    4. Mellander, Erik, 1999. "The multi-dimensional nature of labor demand and skill-biased technical change," Working Paper Series 1999:9, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    5. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    6. Louis Amato & Christie Amato, 2000. "The Impact of High Tech Production Techniques on Productivity and Profitability in Selected U.S. Manufacturing Industries," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 16(4), pages 327-342, June.
    7. J. Beaulieu & Joe Mattey, 1998. "The Workweek of Capital and Capital Utilization in Manufacturing," Journal of Productivity Analysis, Springer, vol. 10(2), pages 199-223, October.
    8. Catherine J. Morrison Paul & Donald Siegel, 1999. "Estimation of Scale Economies Underlying Growth and Productivity: The Empirical Implications of Data Aggregation," Southern Economic Journal, John Wiley & Sons, vol. 65(4), pages 739-756, April.
    9. Erik Mellander, 2000. "The Multi-Dimensional Nature of Labor Demand and Skill-Biased Technical Change," Econometric Society World Congress 2000 Contributed Papers 0671, Econometric Society.
    10. Paolo Epifani & Gino Gancia, 2008. "The Skill Bias of World Trade," Economic Journal, Royal Economic Society, vol. 118(530), pages 927-960, July.
    11. Barseghyan, Levon & DiCecio, Riccardo, 2016. "Externalities, endogenous productivity, and poverty traps," European Economic Review, Elsevier, vol. 85(C), pages 112-126.
    12. Karnit Flug & Zvi Hercowitz, 2000. "Equipment Investment and the Relative Demand for Skilled Labor: International Evidence," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 3(3), pages 461-485, July.
    13. Ghosal, Vivek, 2007. "Small is Beautiful but Size Matters: The Asymmetric Impact of Uncertainty and Sunk Costs on Small and Large Businesses," MPRA Paper 5461, University Library of Munich, Germany.
    14. Robert C. Feenstra & Gordon H. Hanson, "undated". "Productivity Measurement And The Impact Of Trade And Technology On Wages: Estimates For The U.S., 1972-1990," Department of Economics 97-17, California Davis - Department of Economics.
    15. Rahman, Pk. Md. Motiur & Yamagata, Tatsufumi, 2004. "Business Cycles and Seasonal Cycles in Bangladesh," IDE Discussion Papers 1, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    16. Ghosal, Vivek, 2002. "Impact of Uncertainty and Sunk Costs on Firm Survival and Industry Dynamics," Royal Economic Society Annual Conference 2002 86, Royal Economic Society.
    17. Susanto Basu & John Fernald, 2001. "Why Is Productivity Procyclical? Why Do We Care?," NBER Chapters, in: New Developments in Productivity Analysis, pages 225-302, National Bureau of Economic Research, Inc.
    18. Mastromarco, Camilla & Ghosh, Sucharita, 2009. "Foreign Capital, Human Capital, and Efficiency: A Stochastic Frontier Analysis for Developing Countries," World Development, Elsevier, vol. 37(2), pages 489-502, February.
    19. Yoshinori Kurokawa, 2011. "Variety-skill complementarity: a simple resolution of the trade-wage inequality anomaly," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 46(2), pages 297-325, February.
    20. Carlsson, M., 2000. "Measures of Technology and the Short-Run Responses to Technology Shocks - Is the RBC-Model Consistent with Swedish Manufacturing Data?," Papers 2000-20, Uppsala - Working Paper Series.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:jageco:v:50:y:1999:i:1:p:64-82. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0021-857X .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.