Prices, profits, and pass-through of costs along a supermarket supply chain: bargaining and competition

Smith, Howard W.; Thanassoulis, John

doi:10.1093/oxrep/grv007

Cited by 9 publications

(5 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Noton and Elberg (2018) observe wholesale unit prices negotiated between manufacturers and retailers in the Chilean coffee market. Smith and Thanassoulis (2015) provide interviewbased evidence of the use of linear tariffs in the UK liquid milk industry. Outside the food industry, simple linear prices have also been either observed or considered as a good approximation of the contractual form used in the U.S. healthcare sector (Grennan, 2013;Gowrisankaran, Nevo and Town, 2015;Ho and Lee, 2017), the U.S. television multichannel industry (Crawford and Yurukoglu, 2012;, or the U.S. video rental industry (Mortimer, 2008).…”

Section: Introductionmentioning

confidence: 99%

An Empirical Model of Bargaining with Equilibrium of Fear: Application to Retail Mergers in the French Soft Drink Industry

2021

View full text Add to dashboard Cite

We develop a framework of bilateral oligopoly with a sequential two-stage game in which manufacturers engage in bilateral bargains with retailers competing on a downstream market. We show that bargaining outcomes depend on three different bargaining forces and can be interpreted in terms of "equilibrium of fear". We estimate our framework using data on soft drink purchases in France and find that retailers have a higher bargaining power than manufacturers. Using counterfactual simulations, we highlight that retail mergers always increase retailers' fear of disagreement which weakens their bargaining power vis-à-vis manufacturers and leads to higher wholesale and retail prices.

show abstract

Section: Introductionmentioning

confidence: 99%

An Empirical Model of Bargaining with Equilibrium of Fear: Application to Retail Mergers in the French Soft Drink Industry

2021

View full text Add to dashboard Cite

show abstract

“…It is worth noting that milk price had very little impact on the difference in cost between the two protocols. This is unsurprising given the poor correlation between milk price and the cost of a case of CM that has been reported previously ( Down et al, 2013 ) and serves to demonstrate that whilst important in terms of overall farm profitability ( Smith and Thanassoulis, 2015 ), milk price plays a minor role in terms of the cost of CM.…”

Section: Discussionmentioning

confidence: 77%

Factors affecting the cost-effectiveness of on-farm culture prior to the treatment of clinical mastitis in dairy cows

Down

Bradley²,

Breen

et al. 2017

Preventive Veterinary Medicine

View full text Add to dashboard Cite

The objective of this study was to use probabilistic sensitivity analysis to evaluate the cost-effectiveness of using an on-farm culture (OFC) approach to the treatment of clinical mastitis in dairy cows and compare this to a ‘standard’ treatment approach. A specific aim was to identify the herd circumstances under which an OFC approach would be most likely to be cost-effective. A stochastic Monte Carlo model was developed to simulate 5000 cases of clinical mastitis at the cow level and to calculate the associated costs simultaneously when treated according to 2 different treatment protocols; i) a 'conventional' approach (3 tubes of intramammary antibiotic) and ii) an OFC programme, whereby cows are treated according to the results of OFC. Model parameters were taken from recent peer reviewed literature on the use of OFC prior to treatment of clinical mastitis. Spearman rank correlation coefficients were used to evaluate the relationships between model input values and the estimated difference in cost between the standard and OFC treatment protocols. The simulation analyses revealed that both the difference in the bacteriological cure rate due to a delay in treatment when using OFC and the proportion of Gram-positive cases that occur on a dairy unit would have a fundamental impact on whether OFC would be cost-effective. The results of this study illustrated that an OFC approach for the treatment of clinical mastitis would probably not be cost-effective in many circumstances, in particular, not those in which Gram-positive pathogens were responsible for more than 20% of all clinical cases. The results highlight an ethical dilemma surrounding reduced use of antimicrobials for clinical mastitis since it may be associated with financial losses and poorer cow welfare in many instances.

show abstract

“…Agricultural production may face the same concerns about the death of entrepreneurship contributing to low aggregate productivity growth that has been documented throughout the contemporary economy (Decker et al, 2017). It also highlights a recently revived area of research considering the effects of market concentration along supply chains (Fuglie et al, 2012; Hendrickson et al, 2017; MacDonald, 2017) and how market power in one segment affects the outcomes in other concentrated segments (Gaudin, 2018; Sexton & Xia, 2018; Smith & Thanassoulis, 2015).…”

Section: Summary and Discussionmentioning

confidence: 97%

Employment and payroll dynamics in support services for agriculture

Babkin

Dunn

Hueth

et al. 2022

Applied Eco Perspectives Pol

View full text Add to dashboard Cite

An increasing share of agricultural production activities on farms are undertaken by specialist providers. Despite its importance to the farm economy, because of gaps in the federal statistical system, relatively little is known about how this industry has evolved over the past three decades. In this article, we document establishment, employment, payroll, and wage dynamics for businesses that provide support services to crop production. Our analysis reveals that agricultural support service is a uniquely dynamic and rapidly evolving sector of the American economy. Although rates of entry have fallen substantially, large incumbent firms have tended to grow in size. Furthermore, the real annual mean wage to nonagricultural workers employed in the sector has increased by nearly $10,000 since 1992, indicating sizeable growth in labor productivity. Nonetheless, standard measures of economic dynamism, a principal source of productivity growth, have all fallen, which may have implications for innovation and the long-term health of this industry and agricultural production more generally.

show abstract

Prices, profits, and pass-through of costs along a supermarket supply chain: bargaining and competition

Cited by 9 publications

References 10 publications

An Empirical Model of Bargaining with Equilibrium of Fear: Application to Retail Mergers in the French Soft Drink Industry

An Empirical Model of Bargaining with Equilibrium of Fear: Application to Retail Mergers in the French Soft Drink Industry

Factors affecting the cost-effectiveness of on-farm culture prior to the treatment of clinical mastitis in dairy cows

Employment and payroll dynamics in support services for agriculture

Contact Info

Product

Resources

About