This paper pays attention to the Spanish fresh meat market, by
analysing how the different stages of the market chain interact and so,
investigating the presence of market power.
In this paper, we use weekly data for the period 2005¿2007, to examine the
presence of market power in the meat market. In particular, we analyse the
price transmission elasticity and the price transmission asymmetry for fresh
beef, pork, lamb, chicken, rabbit and eggs between the farm and retail market
stages in Spain. Price causality analysis confirms that, in the short run,
upstream level (producer) led to changes in the downstream level (retail).
Furthermore, for all products it can be observed that when the producer price
decreases, the retail price decreases less than proportional; hence, the retail
price increases less than proportional. Therefore, market power does not seem
to explain this asymmetry, because the second behaviour contradicts the market
power perception. Therefore, it seems that lower volatility in the retail market
stage ¿ which may be due to the higher number of available substitutes and
sources and higher repricing costs ¿ explains the asymmetric price
transmission.
GUILLEN GARCIA Jordi;
FRANCESCA Ramon;
2011-01-05
Inderscience Publishers
JRC55736
1757-1170,
http://www.inderscience.com/browse/index.php?journalID=311#content,
https://publications.jrc.ec.europa.eu/repository/handle/JRC55736,
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