Pricing-to-Market versus Residual Demand Elasticity Analysis of Imperfect Competition in Food Exports: Evidence from Germany

Thomas Glauben, Department of Food Economics, University of Kiel, Germany
Jens-Peter Loy, Department of Agricultural Economics, University of Goettingen, Germany

Abstract

This paper examines the exercise of market power by German food and beverage export industries over international markets. Two approaches are used: pricing-to-market (PTM) and residual demand elasticity (RDE). We find that, while in some cases the PTM approach indicates market power, the RDE approach does not. Competitive conduct seems to prevail in these industries. The occurrence of PTM in some cases might be explained by fixed contracts, which are often used in the food and beverage export market.

Recommended Citation

Glauben, Thomas and Loy, Jens-Peter (2003) "Pricing-to-Market versus Residual Demand Elasticity Analysis of Imperfect Competition in Food Exports: Evidence from Germany," Journal of Agricultural & Food Industrial Organization: Vol. 1 : Iss. 1, Article 3.
DOI: 10.2202/1542-0485.1004
Available at: http://www.bepress.com/jafio/vol1/iss1/art3

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