Applied Economics Teaching Resources

an AAEA Journal

Agricultural and Applied Economics Association

Teaching and Educational Methods

Teaching Competition Topics: Applications of Seller Market Power in Agricultural Industries

Yuliya V. Bolotova
Clemson University

JEL Codes: L11, L22, Q11, Q13
Keywords: Agricultural marketing, competition, peanut industry, potato industry, seller market power

Publish Date: September 30, 2019
Volume 1, Issue 2

View Full Article (PDF) | Request Teaching Notes/Supplemental Materials

Abstract

The article presents a simple theoretical framework that can be used to explain conduct and performance of agricultural industries and seller market power in these industries. The framework components include a linear inverse demand function, a constant marginal cost function, and a set of measures of costs, revenue, and profit. The theoretical framework is consistent with agricultural supply and price cycle, and the decision-making process of agricultural producers. The theoretical framework is used to develop applications for the U.S. peanut and potato industries represented by two problem sets provided in the teaching note, which also includes four sets of assessment questions. The article discusses implementation and practical applications of the proposed teaching activity. The target audience includes students taking undergraduate courses in agricultural economics and agribusiness programs as well as extension and outreach audiences.

Acknowledgements: The author acknowledges constructive comments provided by the Editor and two anonymous reviewers. About the Author(s): Yuliya V. Bolotova is an Assistant Professor in the Department of Agricultural Sciences at Clemson University (Corresponding author: Yuliyab@clemson.edu).

Copyright is governed under Creative Commons CC BY-NC-SA

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