Price Transmission, Market Power and Returns to Scale

In this paper, we aim to model the vertical relation between retailers and suppliers in the food industry whereby retailers exercise seller power in their relation with consumers and buyer power in their relation with producers. We then evaluate the degree of price transmission, relative to the perfectly competitive benchmark, from the farm to the retail sector assuming a supply shock. With the view to evaluating the impact of market power's interaction with industry technology on the degree of price transmission, we assume industry technology to be characterised by variable input proportions and non-constant returns to scale. Our model predicts that, relative to that which obtains when markets are perfectly competitive and industry technology is characterised by constant returns to scale, the degree of price transmission when market power and industry technology interact cannot be unambiguously determined.price transmission, returns to scale, market power, Demand and Price Analysis, Marketing, L11, Q13,

Spectral Energy Distributions for Disk and Halo M--Dwarfs

We have obtained infrared (1 to 2.5 micron) spectroscopy for 42 halo and disk dwarfs with spectral type M1 to M6.5. These data are compared to synthetic spectra generated by the latest model atmospheres of Allard & Hauschildt. Photospheric parameters metallicity, effective temperature and radius are determined for the sample. We find good agreement between observation and theory except for known problems due to incomplete molecular data for metal hydrides and water. The metal-poor M subdwarfs are well matched by the models as oxide opacity sources are less important in this case. The derived effective temperatures for the sample range from 3600K to 2600K; at these temperatures grain formation and extinction are not significant in the photosphere. The derived metallicities range from solar to one-tenth solar. The radii and effective temperatures derived agree well with recent models of low mass stars.Comment: 24 pages including 13 figures, 4 Tables; accepted by Ap

Market Power in UK Food Retailing: Theory and Evidence from Seven Product Groups

Establishing the presence of market power in food chains has become an increasingly pertinent line of enquiry given the trend towards increasing concentration that has been observed in many parts of the world. This paper presents a theoretical model of price transmission in vertically related markets under imperfect competition. The model delivers a quasi-reduced form representation that is empirically tractable using readily available market data to test for the presence of market power. In particular, we show that the hypothesis of perfect competition can be rejected if shocks to the demand and supply function are significant and correctly signed in price transmission equations. Using a cointegrated vector autoregression, we find empirical results that are consistent with downstream market power in six out of seven food products investigated, supporting both the findings of the UK competition authority's recent investigation in to supermarkets and renewed calls for further scrutiny of supermarket behaviour by the UK's Office of Trading.imperfect competition, Cointegrated VARs, UK food industry, Marketing, D4, L81,

Non-Linearity Corrections and Statistical Uncertainties Associated with Near-Infrared Arrays

We derive general equations for non-linearity corrections and statistical uncertainty (variance) estimates for data acquired with near-infrared detectors employing correlated double sampling, multiple correlated double sampling (Fowler sampling) and uniformly-spaced continuous readout techniques. We compare our equation for the variance on each pixel associated with Fowler sampling with measurements obtained from data taken with the array installed in the near-infrared cross-dispersed spectrograph (SpeX) at the NASA Infrared Telescope Facility and find that it provides an accurate representation of the empirical results. This comparison also reveals that the read noise associated with a single readout of the SpeX array increases with the number of non-destructive reads, n_r, as n_r^0.16. This implies that the {effective} read noise of a stored image decreases as n_r^-0.34, shallower than the expected rate of n_r^-0.5. The cause of this read noise behavior is uncertain, but may be due to heating of the array as a result of the multiple read outs. Such behavior may be generic to arrays that employ correlated or multiple correlated double sampling readouts.Comment: 21 pages, accepted by PAS