Predicting nitrogen mineralization from soil organic matter - a chimera?

Predicting nitrogen (N) mineralization from soil organic matter is difficult because N mineralization is affected by several environmental factors, while being the net outcome of concurrent N processes that produce and consume mineral N. One aim of the present thesis was to study the effects of freezing and thawing on carbon (C) and N mineralization. A second aim was to elucidate if, and how, the quantity and quality of organic matter inputs affect N mineralization from the pool of soil organic matter. C and net N mineralization were determined in soils from the Ultuna Long-Term Soil Organic Matter Experiment exposed to repeated freezing and thawing (temperatures ranging from –5 °C to +5 °C). C, gross and net N mineralization in relation to quantity and quality of organic matter inputs were determined during long-term laboratory incubations at 20 °C. Gross N mineralization rates were estimated using the 15N isotope dilution technique, which is based on several assumptions. The assumption of ‘equilibrium between added and native N’ was tested by using a published data set in a dynamic compartmental model. Freezing and thawing of soils resulted in a flush in C and N mineralization, but the effect was only short-lived. It was concluded that freezing and thawing of soils during late winter and early spring is unlikely to be of importance to crop N availability in spring. Both quantity and quality of organic matter were major determinants of C and gross N mineralization, and these were proportional suggesting that C mineralization may be used as a predictor for gross N mineralization. Preferential use of added N may be a more common occurrence in 15N isotope dilution studies than hitherto thought and the assumption of ‘equilibrium between added and native N’ needs therefore critical evaluation. The data analysis presented in this thesis offers a way to estimate the potential effects of preferential use on gross N mineralization rate estimates. This thesis indicates that studies based on the mechanisms underlying N processes may improve our understanding of the relation between soil organic matter and N mineralization. Further mechanistic studies should therefore be considered in future N research

Psychological Prices and Price Rigidity in Grocery Retailing: Analysis of German Scanner Data

A substantial degree of price rigidity has been reported for branded foods in various studies with scanner data. One possible explanation for price rigidity is the existence of psychological pricing points. We analyze to which extent psychological pricing plays a role in grocery retailing and whether it contributes to price rigidity of branded foods in Germany. Psychological pricing defined here as just-below-the-round-figure-pricing is empirically analyzed with scanner data of weekly prices for 20 food brands in 38 retail outlets from September 1996 to June 1999. Psychological pricing turned out to be extremely important in German food retailing. Branded food prices are remarkably sticky and psychological pricing points contribute strongly to price rigidity. Other factors like the sales phenomenon and firm-specific effects are additionally important.Marketing, Q110, Q130,

Price variability or rigidity in the food-retailing sector? Theoretical analysis and evidence from German scanner data

In many industrialized countries, the grocery-retailing sector exhibits a strong and increasing market concentration. Hence, it is important to understand retail pricing for many questions related to market power in the marketing chain and to agricultural and food policies. We analyze intertemporal pricing of grocery retailers in Germany with a large set of scanner data for processed foods. In theory, food prices could be rather variable, e.g. due to fluctuating commodity prices in a competitive world, or rather rigid, e.g. due to price adjustment costs. We elaborate that retail sales are crucial and raise food price variability at the points of sale. Despite this, prices are rather rigid and often do not change for many weeks. Moreover, pricing strategies for identical brands vary strongly across retailers. Retailers seem to have differential pricing strategies and, thus, market power. This casts substantial doubt on the assumption of a competitive price transmission in the marketing channel underlying most analyses in agricultural economics. --Grocery retailing sector,pricing patterns,sales,price rigidity,scanner data

Grocery retailing in Germany : situation, development and pricing strategies

Over the last four decades, the German food-retailing sector has been subject to continuous structural change. Most important has been the combination of increasing concentration with rising store size and the growing role of discounters implementing an aggressive EDLP pricing strategy. Thus, consumers have benefited from intensive price competition, despite the higher market share of leading food retailers. The analysis of market conduct, in terms of price formation and pricing strategies, reveals a typical situation of imperfect competition. The law of one price certainly does not hold for individual foods. Price levels and pricing strategies diverge substantially across firms and store types. There are successful retailers with an EDLP strategy, as well as others with a HiLo strategy. A major lesson to be learned from the German experience is that increasing concentration in food retailing does not necessarily imply that more market power is exerted at the expense of consumers. Competitive markets are compatible with a high level of concentration as long as a strong competitive fringe, for example discounters, challenges the large chains in food retailing

Grocery retailing in Germany: Situation, development and pricing strategies

Like many other industrialised countries Germany has experienced a powerful concentration process in food retailing. There are some issues, however, which make Germany a special case in Europe and among industrialised countries in general. This holds true in terms of market structure and concentration, market development and pricing strategies. The market share of hard discounters like Aldi and Lidl has grown continuously in recent decades and the market share of discounters in general has reached a magnitude that is well above that found in other European countries. This has led to robust price competition in German food retailing. Along with this development, it has been very difficult for inward foreign direct investment (FDI) to gain ground in the German food retailing industry. One example was the market entry by Wal-Mart which, given its initial ambitious goals, was not successful. On the other hand, German hard discounters have strongly affected outward FDI by other German food retailers. In the process of expanding into other markets abroad, these companies have had a positive impact on exporting by the German food industry. This article describes and analyses these major trends in German food retailing in detail. It is organised as follows. The structure of food retailing is described and explained in Section 2. Section 3 deals with the importance of inward and outward FDI in German food retailing. It is discussed in both sections how increased concentration in food retailing affects the marketing chain. Price competition is intense in Germany, and studies of food pricing strategies have used scanner data. Therefore a special case study in Section 4 is the analysis of food pricing strategies in Germany based on scanner-data evidence. The analysis shows that the pricing behaviour of food retailers is characterised by the every-day-low-pricing (EDLP) strategies of discounters and the high-lowpricing (HiLo) strategies of their major competitors. The main elements of pricing policies are indicative of firms' market power: repeated price discounts for major food brands, frequent changes of loss leaders, the dominant role of psychological pricing, and a strong price rigidity for all other foods which are not on special offer. --

Grocery retailing in Poland: Structural changes and foreign direct investment

The development of the Polish food retailing sector is very interesting. With the transition from a socialist to a market economy, structural change in the retailing sector has been especially rapid and the new open markets in Poland have attracted foreign investors throughout the economy in general and in the foodretailing sector in particular. This article describes and analyses the major trends in Polish food retailing. It is organised as follows. The structure of food retailing is described and explained in Section 2, first at the store-type level and then at the firm level. How the powerful concentration process in food retailing has affected the marketing chain is also discussed. Inward foreign direct investment (FDI) in Polish food retailing is covered in Section 3. Given the special importance of FDI in the Polish economy during the transition process, an analysis is carried out of the determinants of FDI in retailing within a cross-country dataset and with a particularly detailed look at FDI in Poland. The results are summarised in Section 5. --

Price variability or rigidity in the food-retailing sector? : Theoretical analysis and evidence from german scanner data

In many industrialized countries, the grocery-retailing sector exhibits a strong and increasing market concentration. Hence, it is important to understand retail pricing for many questions related to market power in the marketing chain and to agricultural and food policies. We analyze intertemporal pricing of grocery retailers in Germany with a large set of scanner data for processed foods. In theory, food prices could be rather variable, e.g. due to fluctuating commodity prices in a competitive world, or rather rigid, e.g. due to price adjustment costs. We elaborate that retail sales are crucial and raise food price variability at the points of sale. Despite this, prices are rather rigid and often do not change for many weeks. Moreover, pricing strategies for identical brands vary strongly across retailers. Retailers seem to have differential pricing strategies and, thus, market power. This casts substantial doubt on the assumption of a competitive price transmission in the marketing channel underlying most analyses in agricultural economics

Psychological prices of branded foods and price rigidity : evidence from German scanner data

There is increasing evidence from scanner data that branded foods in the grocery retailing sector contain a substantial amount of price rigidity (HERRMANN/MÖSER 2003). One of the many alternative explanations for price rigidity is the existence of psychological pricing points. The economic literature has been most hesitant against this theory and, in a survey, BLINDER et al. (1998) found no confirmation at all based on the views of business managers. In that study, however, retail trade is underrepresented. The theory of psychological pricing points continues to be an important concept for pricing in firms which directly sell to consumers. Empirical findings in various studies, e.g. in the early work by FRIEDMAN (1967) for food retailing, suggest that psychological prices are widely used in the retailing sector. Hence, it is the objective of this paper to elaborate to which extent psychological pricing plays a role in grocery retailing and whether it contributes to price rigidity of branded foods in Germany. The empirical analysis will be based on scanner data of weekly prices for 20 branded foods in Germany in the period 1996-99

Neue empirische Befunde zur Preissetzung und zum Verbraucherverhalten im Lebensmitteleinzelhandel

There are two objectives of this article: (i) It is discussed theoretically how the dynamics of pricing decisions of multiproduct retailers can be explained. (ii) It is analyzed empirically by use of scanner data how prices are actually set and how consumers react at the point of sale to price changes and promotional activities by retailers. The empirical evidence focuses on breakfast products in general and jam and breakfast cereals in particular. Main results are the following: 1. Theory of optimal pricing by multiproduct firms suggests that direct and cross price elasticities of demand and marginal costs determine the profit-maximizing price at one point of time. Good reasons do exist additionally for multiproduct retailers to vary prices intertemporally. Sales, e.g., can be consistent with optimal intertemporal pricing. 2. Scanner data for German food retailers in the period September 1996 – June 1999 are utilized in the empirical analysis. The law of one price does not hold for individual branded foods across store types. Price dispersion varies by product. The impact of sales is high in grocery retailing; on average for 20 food categories, one product of a category was on sale every other week. 3. Promotional activities affect demand for branded products strongly, but impacts on quantities varied widely. They were above average for coffee, a storeable product, below average for fresh milk, a less storeable good. In some cases, these effects are so strong that consumers seem to buy the brand only when it is on sale. 4. In the special case of jam, prices are lowest in discounters and highest in supermarkets. The spread of prices is also lowest in discounters and highest in supermarkets. Price-elastic reactions at the point of sale was, however, a uniform pattern across all store types of grocery retailing. The strongest reaction was found in supermarkets with a price elasticity of demand of –5.09. 5. For breakfast cereals, strong reactions by consumers occur to various promotional activities. Impacts on demand were, e.g., as high as 175 % when the instruments sales, display and leaflet were combined. Sales were an important feature of promotional activities with a strong demand-increasing effect. Summing up, it can be concluded that an active price policy of grocery retailers is a crucial component of their marketing mix. This is compatible with the finding of a strong price responsiveness of consumers. The stylized fact that the price elasticity of food demand is absolutely low, may be correct for aggregate demand but is not confirmed at the store level. On the contrary: High absolute levels of the store-level price elasticity of demand are typical for branded foods.food retailing, scanner data, price policy, food demand, store-level, price elasticity, multiproduct firms, jam, breakfast cereals, Agribusiness, Demand and Price Analysis,