Imperfect competition and exchange rate pass-through in the international rice market
As a result of the unique segmentation of the international rice market, and the dominance of US and Thailand within certain market segments, a model of monopolistic price discrimination is developed in this study to examine export price adjustment in response to exchange rate fluctuations. The analysis is based on the "pricing to market" (PTM) model which postulates that tests for imperfect competition in international trade can be based on the observed pricing decisions of exporters (Krugman 1987, and Knetter 1989 and 1991). A fixed effects, cross-sectional time-series model is developed to determine the degree to which the United States and Thailand engage in noncompetitive pricing of rice for export. Since both countries control over 50% of the total world export of rice in the 1980s, it is hypothesized that they exercise market power by adjusting prices to different export destinations, resulting in a form of price discrimination.
Year of publication: |
1992
|
---|---|
Authors: | Yumkella, Kandeh Kolleh |
Other Persons: | Unnevehr, L. J. (contributor) |
Subject: | Agricultural |
Saved in:
freely available
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