Buyer Market Power and the Model of Vertical Restraints in Agribusiness

Das, Dipankar

doi:10.4018/ijsem.2019040102

Cited by 3 publications

(3 citation statements)

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“…In the third case, where, If the heterogeneous demand is there in the above two cases. Here, large traders demand some quality products (Das, 2019a). Therefore, the degree of cartel depends on the market structure where the bidders sell the products after buying from the auction.…”

Section: Statement Of the Problem And The Modelmentioning

confidence: 99%

“…Indian Agriculture Reforms 2020 also encourages private capital in agriculture marketing. There is a link between the auction bidders and the small traders outside of the auction process including large private firms (Das, 2019a). To reduce these problems, the Union Budget 2014-15 (para 82) and Union Budget 2015-16 (para 33) suggested the creation of a National Agricultural Market (NAM) as a priority issue.…”

Section: Introductionmentioning

confidence: 99%

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A model of collusion formation and measurement in the open ascending bid auctions in the agricultural markets

Das

2023

JES

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PurposeThis paper gives a model of collusion formation and a method of measuring the degree of it among the traders/bidders in the agricultural commodity markets in India. The important assumption is that the bidding is repetitive with a set of common bidders. The theory has been derived based on the behavior of the wholesale market of agricultural commodities in India. The paper is based on full information in the collusion formation. The paper first derives the theoretical structure of the bidders' behavior and thereafter derives a measure of collusion formation with the help of real-life data.Design/methodology/approachThe paper used the standard theory of optimization and the theory of auction and probability statistics.FindingsThis is a complete information model of cartel formation. The bidding is repetitive and continues forever in discrete time. Hence bidders behavior is observable. Using the proposed method, if the APMC measures for each market and publishes on a periodic basis, say weekly basis, then it will be easier to break the collusion in the market where relative collision is present. For example, if a farmer has three options to sell in three different markets, then the published data would help them to select the market where the degree of collusion is relatively lower. Moreover, the undesirable loss can be avoided based on the right choice of market. As a result, transaction costs will be optima.Originality/valueThe paper first derives the theoretical structure of the bidders' behavior and thereafter derives a measure of collusion formation with the help of real-life data.

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Section: Statement Of the Problem And The Modelmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

A model of collusion formation and measurement in the open ascending bid auctions in the agricultural markets

Das

2023

JES

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“…In the first case, we measure the degree of the cartel in the rural wholesale market in the presence of large traders with quality preference. Das (2019a); Das (2019b) shows that in the presence of large traders (heterogeneous demand) in the rural wholesale market, small and large traders form an informal relationship and a cartel among them. He derives the wholesale price per unit that acts as a benchmark during the auction process as the MSP based on the market interaction using symmetric retailers (both large and small) by W=C+FH+FLDH+DL.…”

Section: Empirical Measurementmentioning

confidence: 99%

Measurement of Collusion in Open Ascending Price Auctions in Agricultural Commodity Markets

Das

Kapoor

2021

Studies in Microeconomics

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This paper derives a method of measuring the degree of collusion among the bidders in an open ascending repetitive price auction in agricultural commodity markets in India. This paper first derives the bidders’ behaviour’s theoretical structure and then a measure of collusion formation. Finally, the degree of the cartel has been computed using time series wholesale price data of potato and onion crops. This research’s findings are helpful for the study of the link between the supply of the agriculture commodity and the degree of collusion. Using the proposed method in this research, if the Agricultural Produce Market Committee (APMC) measures cartel for each market and publish periodically, it will help farmers choose the right market to sell the produce. The farmers would select the market where the degree of collusion is relatively lower. Identifying different small cartel groups at different times with respective to the supply of the agriculture commodity would help avoid the incidence of distress selling by farmers, which is the main hindrance in developing the farming community in India. JEL Classification: C7,D44,L1,L4,Q1

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A Model of Collusion Formation and Measurement in the Open Ascending Bid Auctions in Agricultural Commodity Markets

Das

2020

SSRN Journal

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Buyer Market Power and the Model of Vertical Restraints in Agribusiness

Cited by 3 publications

References 10 publications

A model of collusion formation and measurement in the open ascending bid auctions in the agricultural markets

A model of collusion formation and measurement in the open ascending bid auctions in the agricultural markets

Measurement of Collusion in Open Ascending Price Auctions in Agricultural Commodity Markets

A Model of Collusion Formation and Measurement in the Open Ascending Bid Auctions in Agricultural Commodity Markets

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