The long run, market power and retail pricing

Jumah, Adusei

doi:10.1007/s00181-004-0201-0

Cited by 18 publications

(10 citation statements)

References 39 publications

(29 reference statements)

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“…However, there is a disparity in the use of negotiated pricing as identified by Nagler et al (2015), Kenyon and Purcell (1999), Ajala and Adesehinwa (2007) and McEwan and Duffy (2000). The study also supports the findings by Volpe, Risch, and Boland (2015) and Jumah (2000) of the use of profit orientation in pork industries. However, it falls contrary to Buhr's (2004) findings of competitiveness objectives in pork industries.…”

Section: Discussionsupporting

confidence: 89%

“…Pricing objectives can be grouped into status quo, sales and profit-oriented pricing objectives (Kotler 2002). Jumah (2000) identified the use of mark-up pricing strategy for profit maximisation in the pork industry, which is dependent on market share. Buhr (2004) found that pig industry organisations utilised competitive pricing objectives.…”

Section: Literature Review: Pricingmentioning

confidence: 99%

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Pricing Strategies in Pork-based Agribusinesses: Evidence from Zimbabwe

Ngarava

Mushunje

2019

SABR

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Agribusinesses utilise an array of pricing strategies and practices that may be effective under certain circumstances. Price dictates income, directs the quantity supplied and demanded, provides an indication to customers, and shifts ownership. The objective of the study was to evaluate the current pricing strategies being employed in the Zimbabwean pork industry. The study utilised a cross-sectional survey of 166 pig producers, six pork abattoirs and 24 pork butchers in Mashonaland Central Province of Zimbabwe. A standardised pre-coded questionnaire was the research instrument utilised. Descriptive statistics, MANOVA and multiple linear regression were utilised to analyse the data. The results indicated that agribusinesses were utilising break-even pricing, which is cost-oriented, through a formula price, pursuing profit-oriented pricing objectives, through a one-price policy, aiming for a low-penetration pricing policy, with no discount policy and managing a profit-to-cost ratio between 0% and 4%. The study recommends that the industry be flexible in its pricing mechanisms through utilising sales-oriented objectives and appropriate discount policies to induce “goodwill” within the industry. The industry is also recommended to vertically integrate in order to spread and dilute price risk to allow flexibility in pricing, and to utilise premium pricing.

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Section: Discussionsupporting

confidence: 89%

Section: Literature Review: Pricingmentioning

confidence: 99%

Pricing Strategies in Pork-based Agribusinesses: Evidence from Zimbabwe

Ngarava

Mushunje

2019

SABR

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“…Following Genesove and Mullin (1998) we use quarterly level data to ensure that the estimated elasticity represents the long run elasticity as opposed to the short run. In addition, the long run is considered because under imperfect competition, retailers are more likely to focus on establishing and maintaining a price in the long run rather than focusing on short run profits ( Jumah, 2004). Before specifying the most appropriate empirical model the time series properties of the data were reviewed in order to investigate formally whether the long run demand relationships are economically meaningful or merely spurious.…”

Section: Data and Empirical Modellingmentioning

confidence: 99%

Assessing retail market competition for multi-aquaculture products

Fofana

Jaffry

2015

Journal of Economic Studies

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Purpose – The purpose of this paper is to investigate market competition for three product types of salmon (smoke, fresh and whole salmon) to understand whether supermarkets are exercising market power over salmon consumers in the UK retail market. Design/methodology/approach – Competition and the corresponding pricing conduct among supermarkets are tested by applying dynamic structural simultaneous system equations and using similar data set used by Jaffry et al. (2003). Findings – The results indicate that the market is competitive for fresh fillets and whole salmon but retailers appeared to exert some level of market power for smoke salmon. The hypothesis that market power is the same for all three products in the study was rejected; further indicating that the market for fresh products are competitive while retailers may be exercising market power over consumers for smoke salmon. Research limitations/implications – Current data limitations did not allow the investigation to cover the past few years in the modelling process. However, the results are still relevant as there have been no major structural changes in aquaculture products retailing landscape in the recent past. Practical implications – Concerns over the supermarkets’ exercise of market power over consumers have prompted the competition authorities to continue investigating the situation in the UK supermarket sector since 1996. The most recent investigation by competition authorities was in 2006. In all cases, no evidence of market power was found despite increased market concentration. Results from this study generally uphold the claim of the competition authorities in the UK. Originality/value – This is the first study to use a model within a structural econometric framework of firms to test for competitiveness of salmon products in the UK market place.

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“…For doing so, we estimate an econometric model in which the prices charged by retailers (and paid for the consumers) are a function of the prices charged by the farm producers (there is no information about the prices charged by slaughter houses). We follow Tomek and Robinson [7] and Jumah [8]. The equation estimated is:…”

Section: Economic Frame and Cost Transmissionmentioning

confidence: 99%

The cost of food safety due to animal by-product regulation in Spain: who pays for it?

Esturo

González

Greño³

et al. 2010

WIT Transactions on Ecology and the Environment

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This paper puts forward implications of the implementation of Regulation (EC) No. 1774No. /2002 in Spain, which regulates in an integrated manner all animal by-products that are not intended for human consumption with the maximum hygiene and environmental security. Farmers, slaughter houses, food industries, retailers, animal feed producers, fertilizer producers, transport and logistic businesses, renders, valorisation and waste management plants are activity sectors of great health, environment and economic importance and all of them play an important role in the implementation of the aforementioned regulation. This work analyses in detail the generation and management of the animal by-products in those different stages of the production chain of meat. The focus of the paper is on the transmission of the costs associated to the implementation of the regulation along the production chain. The results show an uneven distribution of the regulation costs, where the farmers face particularly high costs (which are, in general, subsidised by the Government). On the other hand, the transmission of costs to the final consumers depends on the type of animal we considered: for cattle and sheep, the lack of competitiveness in their markets also interferes in the costs transmission.

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The long run, market power and retail pricing

Cited by 18 publications

References 39 publications

Pricing Strategies in Pork-based Agribusinesses: Evidence from Zimbabwe

Pricing Strategies in Pork-based Agribusinesses: Evidence from Zimbabwe

Assessing retail market competition for multi-aquaculture products

The cost of food safety due to animal by-product regulation in Spain: who pays for it?

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