Technical marketing efficiency is an important component of comparative advantage that countries may possess in food marketing. This aspect of marketing efficiency may be affected by size of market(s), technology used, input costs, and institutional factors. With regard to the latter, Norwegian policy makers have asked whether the extensive regulation and monopolization by a single processing cooperative in the Norwegian dairy sector have resulted in technical inefficiency that leads to excessive costs of milk marketing. Excessive marketing costs could have three important impacts; increased prices for domestic consumers, reduced prices for farmers, and reduced competitiveness in international markets. International competitiveness is critical for Norway as it considers or is considered for admission to the European Community and as trade liberalization proceeds under the GATT. The purpose of this analysis was to develop and apply a method for comparing marketing costs between countries to provide some insight into relative marketing efficiency between countries.


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