DISTINGUISHING THE SOURCE OF MARKET POWER: AN APPLICATION TO CIGARETTE MANUFACTURING

We compare nonparametric and nonstructural market power tests using data from the cigarette manufacturing industry. Tests are implemented to examine both monopoly and monopsony power exertion by cigarette manufacturers. Results indicate that market power in the tobacco industry, previously attributed to monopoly power exertion, should at least in part be attributed to monopsony market power in the upstream tobacco market.


Subject(s):
Issue Date:
1998
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/24021
Total Pages:
42
Series Statement:
Faculty Paper 98-17




 Record created 2017-04-01, last modified 2017-08-24

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