Market Power with Dynamic Inventory Constraints: The Bias in Standard Measures

This paper incorporates inventory dynamics into an analysis of market power. Using a model in which each firm accounts for the effect of its current action on the current and future actions of itself and its competitors, we show that measures of market power that ignore inventory dynamics are biased. We then apply the model to the beef-packing industry using annual data on cattle stocks, slaughter and prices from 1933-1999. Our estimates suggest that static measures overestimate the amount of market power exerted by beef-packing firms.market power dynamic cattle conjectural variations stock

Nonbinding Suggestions: The Relative Effects of Focal Points versus Uncertainty Reduction on Bargaining Outcomes

This paper focuses on the effects of nonbinding recommendations on bargaining outcomes. Recommendations are theorized to have two effects: they can create a focal point for final bargaining positions, and they can decrease outcome uncertainty should dispute persist. While the focal point effect may help lower dispute rates, the uncertainty reduction effect is predicted to do the opposite for risk-averse bargainers. Which of these effects dominates is of critical importance in the optimal design of alternative dispute resolution (ADR) procedures, which are becoming increasingly utilized to help resolve disputes in a variety of settings. We theoretically examine the effects of recommendations on the bargaining contract zone. Our theoretical framework, which allows bargainers’ final positions to influence a binding outcome should negotiations fail, provides for a more stringent test of focal points than previously considered. We also present data from controlled laboratory bargaining experiments that are consistent with our model of recommendation effects. Recommendations are empirically shown to influence final bargaining positions and negotiated settlement values. Furthermore, dispute rates are significantly lower when one includes recommendations, even where the recommendation is completely ignored in final-stage arbitration. This highlights a potentially significant role for the use of nonbinding procedures, such as mediation, as a preliminary stage in developing more efficient ADR procedures.

Another Reason to Reform the Federal Regulatory System: Agencies\u27 Treating Nonlegislative Rules as Binding Law

This Note analyzes the nonlegislative rule exception to the rulemaking requirements of the administrative Procedure Act ( APA\u27). To lend greater accountability to federal agencies, the APA places an obligation on agencies to incorporate public input when creating new rules. Agencies, however; can avoid considering public commentary through a vague exception: section 553(b)(A) of the APA. After analyzing section 553(b)(A), this. Note evaluates how one agency, the Food and Drug Administration, has responded to the confusion surrounding the exception. Finally, this Note considers how the Senate has overlooked problems associated with section 553(b)(A) in the Senate\u27s most recent bill to revise administrative procedures

THE ROLE OF TRANSACTION COSTS IN MARKET SELECTION: MARKET SELECTION IN COMMERCIAL FEEDER CATTLE OPERATIONS

A survey of commercial feeder cattle operations in Utah revealed that explicit transaction costs such as transportation, shrink, and commissions can not fully explain how marketing alternatives are selected. Implicit transaction costs appear to play a critical role in the determination of market selection. For example, the level of trust between buyer and seller and the socio-economic characteristics of market participants are determinants of which marketing method will be used to sell feeder cattle.Livestock Production/Industries, Marketing,

If You Can't Trust the Farmer, Who Can You Trust? The Effect of Certification Types on Purchases of Organic Produce

An information asymmetry exists in the market for organic produce since consumers cannot determine whether produce is organically or conventionally grown. Various methods may solve this problem including signaling, reputation, and certification. Signaling and reputation may not work well, because signals are noisy, and reputation may be difficult for a producer to establish. Certification of the farm and its growing methods shows the most promise. A survey instrument testing the efficacy of certification is presented along with empirical analysis suggesting that no notable difference existed between independent certification methods, although independent certification had significantly different effects than self-certification.Asymmetric information, Certification, Ordered probit, Organic produce, Agribusiness,

MEASURING MARKET POWER WITH VARIABLES OTHER THAN PRICE

Beef packing has become an extremely concentrated industry, yet studies have found that little, if any market power exists. We propose and test alternative measures of behavior that may better describe how packers control purchases from feedlots, using confidential data collected by the USDA Grain Inspection, Packers and Stockyards Administration.Marketing,

MARKET POWER IN BEEF PACKING: FEEDLOT "CAPTURE" AND ITS CAUSES

Concentration in the beef packing industry has been rising for the past 25 years. Many studies of market power in beef packing are based on the conjectural variations framework, which depends on accurate estimates of packer input and processing costs. We propose an alternative measure of packer behavior which does not rely on estimates of packer costs. We also suggest how this measure could be used to draw tentative conclusions regarding packer behavior.Agribusiness, Marketing,

School Sense of Community, Teacher Support, and Students\u2019 School Safety Perceptions

This study examined the association between two characteristics of school climate (sense of community and teacher support, measured both at the individual and at the school level) and students\u2019 feelings of being unsafe at school. The study involved a sample of 49,638 students aged 10\u201318 years who participated in the 2010\u20132012 California Healthy Kids Survey. Using hierarchical linear modeling (HLM), our findings revealed that, at the individual level, students perceiving higher levels of sense of community and teacher support at school were less likely to feel unsafe within the school environment. At the school level, sense of community was negatively associated with unsafe feelings, whereas there was no association between school-level teacher support and feelings of being unsafe at school

The Negativity Bias Predicts Response Rate To Behavioral Activation For Depression

Background and Objectives: This treatment study investigated the extent to which asymmetric dimensions of affective responding, specifically the positivity offset and the negativity bias, at pretreatment altered the rate of response to Behavioral Activation treatment for depression. Method: Forty-one depressed participants were enrolled into 16 weekly sessions of BA. An additional 36 lifetime healthy participants were evaluated prospectively for 16 weeks to compare affective responding between healthy and remitted patients at post-treatment. All participants were assessed at Weeks 0, 8 and 16 using repeated measures, involving a structured clinical interview for DSM-IV Axis I disorders, questionnaires, and a computerized task designed to measure affective responses to unpleasant, neutral, and pleasant images. Results: The negativity bias at pre-treatment predicted the rate of response to BA, while the positivity offset did not. Limitations: Only one treatment condition was used in this study and untreated depressed participants were not enrolled, limiting our ability to compare the effect of BA. Conclusions: Baseline negativity bias may serve as a signal for patients to engage in and benefit from the goal-directed BA strategies, thereby accelerating rate of response