Market Power in the Carbonated Soft Drink Industry
| dc.creator | Allender, William J. | |
| dc.creator | Richards, Timothy J. | |
| dc.date | 2017-04-01T13:47:59Z | |
| dc.date.accessioned | 2026-07-09T05:35:53Z | |
| dc.description | We investigate the strategic pricing for leading brands sold in the carbonated soft drink (CSD) market in the context of a flexible demand specification (i.e. random parameter nested logit) and a structural pricing equation. Our approach does not rely upon the often used ad hoc linear approximations to demand and profit-maximizing first-order conditions. We estimate the structural pricing equation using four different estimators (i.e. OLS, LIML, 2SLS, and GMM) and compare the implied deviation from Bertrand-Nash competition. Our results suggest that retailers, on average, price CSD brands below their cost, likely a result of the competitive retailing environment. We also find CSD wholesalers price their brands significantly more cooperatively than Bertrand-Nash would suggest, thus inflating profits. | |
| dc.identifier | doi:10.22004/ag.econ.104222 | |
| dc.identifier | https://ageconsearch.umn.edu/record/104222/files/CSD_Market_Power_Poster.pdf | |
| dc.identifier | http://ageconsearch.umn.edu/record/104222 | |
| dc.identifier.uri | http://hdl.handle.net/123456789/565806 | |
| dc.language | eng | |
| dc.publisher | ||
| dc.source | http://ageconsearch.umn.edu/record/104222 | |
| dc.title | Market Power in the Carbonated Soft Drink Industry | |
| dc.type | Text |