Technology, Labor Wars, and Producer Dynamics: Explaining Consolidation in Beefpacking

14 Pages Posted: 21 Apr 2020

See all articles by James M. MacDonald

James M. MacDonald

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

Michael Ollinger

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS)

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Date Written: November 2005

Abstract

Beefpacking underwent a dramatic transformation in the 1970s and 1980s, as plants got much larger and industry concentration rose dramatically. We use individual Census Bureau plant records to analyze the sources of the transformation. We find that there were modest but extensive scale economies in packing plants, covering the full range of plant sizes, and that such economies became more important throughout the period of the study. As production shifted to larger plants, we estimate that the industry's aggregate processing costs fell by 35.3% by 2002, compared to what they would have been without consolidation.

Keywords: concentration, cost function, meatpacking, scale economies

Suggested Citation

MacDonald, James M. and Ollinger, Michael, Technology, Labor Wars, and Producer Dynamics: Explaining Consolidation in Beefpacking (November 2005). American Journal of Agricultural Economics, Vol. 87, Issue 4, pp. 1020-1033, 2005, Available at SSRN: https://ssrn.com/abstract=3581164 or http://dx.doi.org/10.1111/j.1467-8276.2005.00785.x

James M. MacDonald (Contact Author)

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

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Michael Ollinger

U.S. Department of Agriculture (USDA) - Economic Research Service (ERS) ( email )

355 E Street, SW
Washington, DC 20024-3221
United States

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