Determinants of Profitability in Oligopoly and Oligopsony Markets
This paper provides a theoretical model in which the firms within aprocessing industry behave in an oligopolistic and oligopsonisticmarket simultaneously. The model developed yields an equation forprofit margin influenced by determinants of marginal processing costas well as distortions in both mark...
| Main Authors: | , |
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| Format: | Article |
| Language: | fas |
| Published: |
پژوهشگاه حوزه و دانشگاه
2005-09-01
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| Series: | جستارهای اقتصادی |
| Subjects: | |
| Online Access: | https://iee.rihu.ac.ir/article_314_fecf20ecf0ee1eebb1d3cd08d03ec30f.pdf |
| Summary: | This paper provides a theoretical model in which the firms within aprocessing industry behave in an oligopolistic and oligopsonisticmarket simultaneously. The model developed yields an equation forprofit margin influenced by determinants of marginal processing costas well as distortions in both markets. By pooled cross section andtime series data, the equation is estimated for eleven sugar factoriesinvolved in Tehran Exchange Market over the period of ١٩٩٦-٢٠٠٣.Applications for both markets indicate that with an increase in boththe input share and output share, it causes an increase in the profitmargin; however, it reduces due to increasing in wages fuel andenergy costs. With competitive oligopsonistic market, the collusiondegree initiated by Clarke and Davies (١٩٨٢) in oligoppolistic marketis estimated. It turns out that the collusion parameter is lower andnegligible since price elasticity of demand is a faction for the quasiprice elasticity, but by considering only quasi price demand elasticity,the degree of collusion is estimated to be higher. |
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| ISSN: | 1735-3300 2588-5812 |