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Seminario CEA-MIPP

Hora: 12:30
Lugar: Sala 316 – Beauchef 851, piso 3 | Departamento de Ingeniería Industrial
Tema: Buyer Conduct and Supply Shocks: Evidence from Uruguayan Meatpacking Firms
Presenta: Jose Manuel Paz y Miño (FEN U.Chile)
Abstract: We investigate the relation between supply shocks and conduct when firms have oligopsony power. We explore if, following a supply shock, buyers increase or decrease their conduct. To do this, we estimate a structural model of the Uruguayan meatpacking industry, an export-oriented industry subject to frequent price-fixing investigations. Our results show that under supply shocks that reduce input prices, buyers increased their conduct. When we decompose the effect of this type of shock, we find that changes in conduct partially offset any potential welfare-enhancing effects. In our preferred specification, total surplus would have increased by 4.671% under constant conduct in comparison to 1.707% if we allow conduct to change. We interpret our results through a simplified theoretical model that links these shocks to varying fixed costs of collusion.

Our results highlight time-varying conduct behavior by buyers and how it can dampen cost-efficiencies along an industry. Keywords: Buyer Market Power, Firm Conduct, Meat-Packing Industry. JEL Classification: L13, L40, C51.

Organizan: Centro de Economía Aplicada (CEA) e Instituto Milenio para la Investigación de Mercado y Políticas Públicas (MIPP)
Más información: https://mipp.cl/es/events_category/seminario/
Confirmación: obarrera@dii.uchile.cl