Price or Quantity Competition?: Oligopolistic Structures in International Commodity Markets
REVIEW OF INTERNATIONAL ECONOMICS
Posted: 30 Apr 1998
International commodity markets may be characterised by price or quantity competition and by product differentiation. As an illustration, we present a set of models of the Japanese market for imported beef. The models are evaluated using an non-nested econometric test. The one which best fits the data is a Stackelberg model with price leadership by Australia. This result provides evidence on the explicit nature of the game being played by exporters, unlike the applied conjectural variations approach which only provides an index of how competitive the market is.
JEL Classification: F12, F14, C71
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