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Imperfect Competition in German Food Retailing: Evidence from State Level Data

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  • Sven Anders

Abstract

An increase in the level of retail concentration in food markets across Europe has raised concerns about the implications of retail dominance in the food supply. This paper measures oligopoly and oligopsony market power in the German food retail industry and incorporate specific details about the German meat market and the European BSE crisis. In this paper, simultaneous estimates of the degree of oligopoly and oligopsony market power in the German food retail industry are derived by applying a set of monthly state level retail beef and pork marketing data in the federal state of Hessen, Germany, from 1995–2000. Results strongly suggest evidence of retail oligopoly and oligopsony power. Lerner index estimates indicate retail market power accounts for 0.5% to 11% of the retail unit margins of beef and pork. Copyright International Atlantic Economic Society 2008

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  • Sven Anders, 2008. "Imperfect Competition in German Food Retailing: Evidence from State Level Data," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 36(4), pages 441-454, December.
    • Handle: RePEc:kap:atlecj:v:36:y:2008:i:4:p:441-454
    DOI: 10.1007/s11293-008-9136-8
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    More about this item

    Keywords

    Food retailing; Meat marketing; Oligopoly; Oligopsony; Conjectural variation; BSE; Germany; C10; C32; D21; L10; L13; L66; O50; Q13; R10;
    All these keywords.

    JEL classification:

    • C10 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General

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