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Regulation and Firm Size, Foreign-Based Company Market Presence, Merger Choice In The U.S. Pesticide Industry

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  • Michael Ollinger
  • Jorge Fernandez-Cornejo

Abstract

This paper uses Two-Stage Least Squares to examine the impact of pesticide product regulation on the number of firms and the foreign-based company market share of U.S. Pesticide Companies. It also investigates merger choice with a multinomial logit model. The principal finding is that greater research and regulatory costs affected small innovative pesticide companies more than large ones and encouraged foreign company expansion in the U.S. pesticide market. It was also found that the stage of the industry growth cycle and farm sector demand influenced the number of innovative companies and foreign-based company market share. Finally, firms that remain in the industry were found to have greater price cost margins, lower regulatory penalties costs, and a much greater multinational business presence than those that departed.

Suggested Citation

  • Michael Ollinger & Jorge Fernandez-Cornejo, 1994. "Regulation and Firm Size, Foreign-Based Company Market Presence, Merger Choice In The U.S. Pesticide Industry," Working Papers 94-6, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:94-6
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    File URL: https://www2.census.gov/ces/wp/1994/CES-WP-94-06.pdf
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    References listed on IDEAS

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    Cited by:

    1. Douglas W Dwyer, 1995. "Whittling Away At Productivity Dispersion," Working Papers 95-5, Center for Economic Studies, U.S. Census Bureau.

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