Strategic Behavior and Consolidation in the Agricultural Biotechnology Industry
We develop a model explaining the consolidation patterns in the agricultural biotechnology industry. Among different consolidation and cooperation mechanisms, we consider collaborative and licensing agreements, joint ventures, acquisitions, and exchanges of ownership and spin-offs. The key results derive from the benefits of coordinated actions, distinction between transferable and nontransferable payoffs, the substitutability, complementarity, and the importance of the managers' noncontractible investments, and access and expansion of markets. Results from the model are used to examine the cooperation and consolidation activities for four major players in the agricultural biotechnology industry, <link rid="b4">DuPont</link>, <link rid="b3">Dow Chemical</link>, <link rid="b10">Monsanto</link>, and <link rid="b11">Novartis</link>. Copyright 2003 American Agricultural Economics Association.
Year of publication: |
2003
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Authors: | Johnson, Stanley R. ; Melkonyan, Tigran A. |
Published in: |
American Journal of Agricultural Economics. - American Agricultural Economics Association. - Vol. 85.2003, 1, p. 216-233
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Publisher: |
American Agricultural Economics Association |
Saved in:
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