Testing oligopolistic behavior

Research output: Contribution to journalArticle

48 Citations (Scopus)

Abstract

This paper develops an empirical model of short-run pricing behavior for firms in a homogeneous product oligopoly. It is based on the variable profit function and related output supply and factor demand equations and is used to analyze the behavior of firms in the coffee roasting industry. A parametric test of the dominant firm model is developed and applied. The hypothesis of dominant firm behavior and Cournot behavior are rejected. The hypothesis of price-taking behavior is rejected for the largest two firms in the industry but is not rejected for all other firms. Using the estimated pattern of firm behavior, an index of overall industry performance is constructed.

Original languageEnglish (US)
Pages (from-to)367-383
Number of pages17
JournalInternational Journal of Industrial Organization
Volume2
Issue number4
DOIs
StatePublished - Jan 1 1984

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Testing
Industry
Coffee
Profitability
Costs
Dominant firm
Firm behavior
Oligopoly
Short-run
Profit function
Industry performance
Cournot
Pricing behaviour
Price-taking
Empirical model
Factor demand

All Science Journal Classification (ASJC) codes

  • Industrial relations
  • Engineering (miscellaneous)
  • Economics and Econometrics
  • Economics, Econometrics and Finance (miscellaneous)
  • Strategy and Management

Cite this

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Testing oligopolistic behavior. / Roberts, Mark John.

In: International Journal of Industrial Organization, Vol. 2, No. 4, 01.01.1984, p. 367-383.

Research output: Contribution to journalArticle

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