Testing Market Power and Welfare Effects in the US Catfish Industry

Giap V. Nguyen; Curtis M. Jolly; Thong T. Nguyen

doi:10.1515/jafio-2019-0025

Testing Market Power and Welfare Effects in the US Catfish Industry

Giap V. Nguyen^*
, Curtis M. Jolly
, Thong T. Nguyen

^*Corresponding author for this work

Research output: Contribution to journal › Journal article › Research › peer-review

Abstract

An empirical specification of the conjectural variations model, which conforms to microeconomic theory, is estimated for the US catfish industry. We find the existence of market power exerted by US catfish processors. Processors force the price paid to catfish growers down by 52.88 cent per pound of live catfish, which costs US catfish growers about $300 million a year. US catfish growers can deter the negative effects of processors' market power by increasing their farm supply flexibility. Further studies are needed to address the dynamics and competitive game strategies in the US catfish industry.

Original language	English
Article number	20190025
Journal	Journal of Agricultural and Food Industrial Organization
Volume	20
Issue number	2
Pages (from-to)	1-11
Number of pages	11
DOIs	https://doi.org/10.1515/jafio-2019-0025
Publication status	Published - Dec 2022
Externally published	Yes

Bibliographical note

Published online: February 5, 2020.

Keywords

Market power
Welfare analysis
US catfish

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Cite this

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title = "Testing Market Power and Welfare Effects in the US Catfish Industry",

abstract = "An empirical specification of the conjectural variations model, which conforms to microeconomic theory, is estimated for the US catfish industry. We find the existence of market power exerted by US catfish processors. Processors force the price paid to catfish growers down by 52.88 cent per pound of live catfish, which costs US catfish growers about \$300 million a year. US catfish growers can deter the negative effects of processors' market power by increasing their farm supply flexibility. Further studies are needed to address the dynamics and competitive game strategies in the US catfish industry.",

keywords = "Market power, Welfare analysis, US catfish, Market power, Welfare analysis, US catfish",

author = "Nguyen, \{Giap V.\} and Jolly, \{Curtis M.\} and Nguyen, \{Thong T.\}",

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AU - Jolly, Curtis M.

AU - Nguyen, Thong T.

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PY - 2022/12

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N2 - An empirical specification of the conjectural variations model, which conforms to microeconomic theory, is estimated for the US catfish industry. We find the existence of market power exerted by US catfish processors. Processors force the price paid to catfish growers down by 52.88 cent per pound of live catfish, which costs US catfish growers about $300 million a year. US catfish growers can deter the negative effects of processors' market power by increasing their farm supply flexibility. Further studies are needed to address the dynamics and competitive game strategies in the US catfish industry.

AB - An empirical specification of the conjectural variations model, which conforms to microeconomic theory, is estimated for the US catfish industry. We find the existence of market power exerted by US catfish processors. Processors force the price paid to catfish growers down by 52.88 cent per pound of live catfish, which costs US catfish growers about $300 million a year. US catfish growers can deter the negative effects of processors' market power by increasing their farm supply flexibility. Further studies are needed to address the dynamics and competitive game strategies in the US catfish industry.

KW - Market power

KW - Welfare analysis

KW - US catfish

KW - Market power

KW - Welfare analysis

KW - US catfish

U2 - 10.1515/jafio-2019-0025

DO - 10.1515/jafio-2019-0025

M3 - Journal article

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