Economic analysis of the changing structure of the U.S. flour milling industry

Abstract

This article presents a decomposed Poisson regression model based on count data that evaluates structural changes in size, number of plants in each size class, and the concentration level of market power in the U.S. flour milling industry, simultaneously. Empirical results indicate that the effects of a changing wage rate and corporate bond rate on both the size distribution and the number of flour mills are significant, but in opposite directions. Furthermore, a test for price leadership reveals that the U.S. flour milling industry has an oligopolistic market structure. [Econ-Lit citations: D430, L110, Q120]

A Decomposed Negative Binomial Model of Structural Change: A Theoretical and Empirical Application to U.S. Agriculture

“…(9). 5 See Kim et al (2001), for a similar application for the U.S. flour-milling industry. 6 The authors realize that large farms employ most hired farm workers.…”

Entry, Exit, and Structural Change in Pennsylvania's Dairy Sector

“…Since then, numerous researchers have applied the Markov chain model in various agricultural settings. Lee, Judge, and Takayama (1965), Disney, Duffy, and Hardy (1988), and Gillespie and Fulton (2001) all examine hog operations, while Hallberg (1969), Ethridge, Roy, and Myers (1985) and Kim, Lin, and Leath (1991) examine dairy processing, cotton ginning, and flour milling agribusinesses, respectively. Other uses of the Markov model include Chan (1981) for the Canadian cattle industry and Garcia, Offutt, and Sonka (1987) for Illinois crop farms.…”

Changes to the Natural Gas, Corn, and Fertilizer Price Relationships From the Biofuels Era

“…That is, if the ammonia sector is perfectively competitive, then its price should not be influenced by the price of corn (the demand component). The literature (Kim et al, 2001) indicates that fertilizer firms are oligopolies, a market structure in which firms must take into account the reactions of other firms in their pricing strategies. We also test for market power in our models by using two different variables: capacity utilization (i.e., the percentage of nitrogen plants operating based on their rated capacity) and the number of nitrogen fertilizer-producing companies.…”