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Journal of Agricultural & Food Industrial Organization

Ed. by Azzam, Azzeddine

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1542-0485
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Russian Market Power in International Wheat Exports: Evidence from a Residual Demand Elasticity Analysis

Kerstin Marit Uhl
  • Corresponding author
  • Department Agricultural Markets, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), Theodor-Lieser-Str. 2, 06120 Halle (Saale), Germany
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/ Oleksandr Perekhozhuk
  • Department Agricultural Markets, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), Theodor-Lieser-Str. 2, 06120 Halle (Saale), Germany
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/ Thomas Glauben
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Published Online: 2018-01-10 | DOI: https://doi.org/10.1515/jafio-2016-0026

Abstract

Russia has emerged as a major wheat exporter since the beginning of the 2000s, and today, it possesses high market shares in several wheat-importing countries in the Middle East and North African region. This has raised concerns that Russia might abuse its dominant market position by pricing above marginal cost. Using a novel dataset with weekly information on Russian wheat exports, we apply the residual demand elasticity method to analyze the pricing behavior of Russia in its two most important export markets, i. e. Egypt and Turkey. Our estimation results reveal that Russia behaves competitively in Egypt while it exerts market power in Turkey with an estimated mark-up of 13.5 %.

Keywords: Russian wheat exports; market power; residual demand elasticity approach

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About the article

Published Online: 2018-01-10


This work has been developed in the project „Global Food Security and the Grain Markets in Russia, Ukraine and Kazakhstan (GERUKA)“ (reference number: 2811HS023) and is partly funded by the Bundesministerium für Ernährung und Landwirtschaft, Bundesanstalt für Landwirtschaft und Ernährung.


Citation Information: Journal of Agricultural & Food Industrial Organization, 20160026, ISSN (Online) 1542-0485, DOI: https://doi.org/10.1515/jafio-2016-0026.

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