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Abstract

This paper explores the effects of market concentration on urban food prices utilizing different market structure measures. An econometric model of urban food price determination is developed and estimated using pooled cross section and time series data for 18 metropolitan areas in the U.S. Results indicate that food prices are higher in markets where concentration is greatest, confirming general oligopoly theory, but do not necessarily indicate the need for anticoncentration policy in urban food markets. This finding is highly conditional on the concentration measures used in the analysis, however.

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