ILARIA SALVATI WINNER OF 2016 EDITION
with the project Market Power and Imperfect Pass-Through in the Agricultural Sector.
Abstract. The last work by Iapadre and Pace (2016), aiming at investigating the price effects of trade policies and the impact that the degree of competition in the distribution service market has on them, results in a model confirming the pro-competitive effect of trade liberalization, but also the weakening effect intermediaries’ market power can exercise on it. In fact, in the case of a tariff reduction, the pass-through on prices is affected by the presence of market access barriers in the distribution services.
Intermediaries play a huge role in today’s value chains. Their importance appears even more clearly when taking into account that production processes are increasingly fragmented internationally, and that the tasks characterized by a higher level of value added are those located upstream or downstream the so-called “global value chains” (Baldwin, 2011). Distribution channels are particularly relevant in sectors like agriculture, characterized by a high degree of vertical coordination, where producers and consumers are usually located far from each other, given the nature itself of the production processes.
Several contributions, both theoretical and empirical, underline the relevance of intermediaries in explaining the spread between production and consumer prices in agricultural economics. New interest in the matter rose again at the end of the last decade, when agricultural and food prices experienced a certain degree of variability. In particular, the European Commission (2009) observed that, when agricultural commodity prices grew in 2007/2008, their increase was passed on to consumers but, following their decline in 2008/2009, the transmission of prices reduction to consumers was less then complete. These discrepancies between producer and consumer price patterns reflect “structural weaknesses in the system, such as the number of intermediaries operating along the chain and the competitive structure”, and “pervasive inequalities in bargaining power between contracting parties”.
However, there is no general consensus about the link between market power and the degree of price transmission (Swinnen and Vandeplas, 2014). Given the relevant implications in terms of policies and welfare, the matter is worth of being further investigated.
This research project, in particular, aims at analyzing if and how price reductions in the agricultural sector, determined by a cut in tariffs, are passed on to final consumers, taking into account the degree of competition among intermediaries.
2016 EDITION – CALL FOR APPLICATIONS
The following institutions:
• AIEAA – Italian Association of Agricultural and Applied Economics
• CRD – Manlio Rossi-Doria Centre for Economic and Social Research (Roma Tre University)
• Department of Agricultural and Resource Economics (University of California at Davis)
• Department of Economics, Statistics and Finance (University of Calabria)
hereby establish a scholarship in memory of Giovanni Anania.
The scholarship shall be awarded to a student enrolled in the first or second year of an Italian doctoral program (the 2016 edition is for students enrolled in the 30th and 31st doctoral cycles) with a research project in one of the following fields:
• international trade,
• negotiations and agreements on market liberalization,
• sectoral and trade policies in the agri-food sector.
The scholarship is in the amount of €5,000.00 and shall serve to help cover the expenses of a stay of a minimum of four months, tuition-free, at the Department of Agricultural and Resource Economics of the University of California at Davis (United States), with the right to attend educational activities and seminars organized by the Department. Thanks to the International Agricultural Trade Consortium (IATRC) the winner can also attend the IATRC’s Annual Meeting free of charge.
The deadline for the 2016 Call for Applications is June 30th. By this date, applications must have been transmitted to email@example.com