Vertical integration in the Brazilian orange juice sector: power and transaction costs

This paper aims to investigate the role of market power on vertical integration choices in the Brazilian orange juice sector. The main hypothesis states that market power, along with economizing drivers, has had an important role in the economic organization of the orange juice sector. In order to accomplish this task, we examine the make-or-buy decision of juice-processing firms in procurement of inputs (fruits), through a 15-year panel of five firms (more than 90% of the market). Empirical results offer new theoretical insights on role of market power in vertical integration decision. From these theoretical advancements, as implications for practitioners, market power raises attention for critical strategizing issues and antitrust remedies.


Issue Date:
2018-2018-2018
Publication Type:
Journal Article
ISSN:
1559-2448
Language:
English
Published in:
International Food and Agribusiness Management Review, Volume 21, Issue 1
Page range:
1-16
JEL Codes:
D23; L22; L49




 Record created 2018-01-10, last modified 2018-01-22

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