The potential existence of buyer power in U.K. food retailing has attracted the scrutiny of the U.K.'s anti-trust authorities, culminating in the second of two comprehensive regulatory inquiries in recent years. Such inquiries are authoritative but correspondingly time-consuming and costly. Moreover, detection of buyer power has been dogged by the paucity of reliable evidence of its existence. In this paper, we present a simple theoretical model of oligopsony which delivers quasireduced form retailer-producer pricing equations with which the null of perfect competition can be tested using readily available market data. Using a cointegrated vector autoregression, we find empirical results that show the null of perfect competition can be rejected in seven of the nine food products investigated. Though not conclusive on the existence of buyer power, the proposed test offers a means via which the behaviour of the retail-producer price spread is consistent with it. At the very least, it can corroborate the concerns of the anti-trust authorities as to whether buyer power is potentially one source of concern.
The relationship between trade and growth has been central to development economics with particular emphasis on the export-growth dynamic. The current paper is in the tradition of this literature but develops two new strands. First, it examines the exports-growth link in a dynamic fashion, providing a more rigorous approach than has been attempted previously. Second it explores the role of export composition in determining growth performance. By constructing a panel of 69 countries and using the dynamic model, the results generated suggest that there is a strong positive relationship between exports and growth. Further, it is apparent that the composition of those exports is important in determining the strength of growth.Exports, growth, panel econometrics,
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