ARE 221
ORGANIZATION AND STRATEGIES IN FOOD INDUSTRIES
SPRING 2001
Location: W.B. Young Room 332
Time: Tu-Th 11:00-12:15
Instructor: Ronald W. Cotterill
Office: W.B. Young Room334
Office Hours: by appointment or as announced inclass
COURSE DESCRIPTION
Prerequisite: ARE 150 or ECON 112
Course Description: This course examines the market structure, strategies,and
performance of the food system from the farmerto the final consumer. Primary
emphasis, however, will be on food processing (e.g., milk, meat,processors;bakers,
vegetable canners), retailing (e.g., supermarkets),and public policiesrelated
to our modern food system. The analysis is from anindustrialorganization
perspective but assumes a basic knowledge of microeconomics.Topics included
are: competition, market power, product differentiation,advertising,
barriers to entry and exit, mergers, firm rivalry, competitivestrategiesincluding
pricing and non-price strategies, and market performanceissuesincluding prices,
costs, labor issues, progressiveness, and antitrustpolicy.Grading:
Midterm Exam 40%, Final Exam 40%, Paper 20%
Text: W. G. Shepherd, The
Economics of Industrial Organization, 4th edition, Prentice-Hall:
England Cliffs, 1997.Assigned readings on food system organization willbe
put on reserve inthe department library (room 335) and my office (room334).
Many can be downloadedfrom this website (http://www.sp.uconn.edu/~cotteril/ARE221rl.html).
Reading List
I. Introduction
II. Theories of Competition and Monopoly
III. Market Structure
- Shepherd Ch. 3
- Federal Merger Guidelines. 1992 revised.
http:www.usdoj.gov
- Rogers,
R.2001."Structural Change in US Food Manufacturing, 1958-1997." Agribusiness
17(1).
IV. Performance
- Shepherd Ch. 4, 5
- Scherer F.M. and D. Ross. 1990. Industrial Market Structure and
EconomicPerformance Boston:Houghton Mifflin Co. pp227-229. (Quantity
CournotModel).
- Concentration-Profits in Food Industries (handout).
- Cotterill, R. W. 1986. Market Power int he Retail Food Industry: Evidence
from Vermont. Review of Economics and Statistics 68(3):379-386.
- Cotterill, R. W. "How Will the Royal Ahold Purchase of Pathmark
SupermarketsAffect Prices?" August, 1999. Food Marketing Policy CenterIssue
Paper No.19.
IP19.pdf
- Cotterill, R.W., "Performance Consequences of the Agricultural Cooperatives
Exemption," paper presented at the American Bar Association meeting,August10,
1993.
V. Determinants of Market Structure
- Shepherd Ch. 6, 7
- Cotterill, R.W. 1993. "Food Retailing Mergers Leveraged Buyouts and
Performance"inL. Duetsch, Industry Studies, Prentice Hall: Englewood
Cliffs.
- Cotterill, Ronald W. 2000. Dynamic Explanations of Industry Structure
and Performance. University of Connecticut, Storrs, CT. April.
RR#53.pdf
- Cotterill, R.W. 1999. Continuing Concentration in Food Industries Globally:
Strategic Challenges to an Unstable Status Quo. University of Connecticut,
Storrs, CT. October.
RR#49.pdf
VI. Behavior
- Shepherd Ch. 8-12
- Michael Mauboussin, "The Winner is Tit for Tat" Equity Research, C.S.
FirstBoston, December16, 1994.
- Cotterill, R.W. and A. W. Franklin. 2001. The Public Interest
andPrivate Economic Power: A Case Study of the Northeast Dairy Compact.University
of Connecticut. January.
- Cotterill, R.W., T. P. Dhar, and A.W. Franklin. 1999. "Post
Merger Price Conduct: A Case Study of Pricing in Connecticut Markets After
the1996 Royal Ahold-Stop & Shop Merger." Food Marketing PolicyCenter
ResearchReport No. 47. University of Connecticut, Storrs,CT. October.
RR#47.pdf
VII. Competition Policy
- Shepherd Ch. 15, 16
- Cotterill, R.W., 1999. "An Antitrust Economic Analysis of the
ProposedAcquisitionof Supermarkets General Holdings Corporation by Ahold
AcquisitionsInc."Food Marketing Policy Center Research Report No. 46. University
ofConnecticut, Storrs,CT.
RR#46.pdf
- Gejdenson,
Sam and Charles Schumer,1995. "Consumers in a Box, A ConsumerReport
on Cereal." Agribusiness 15(2):207-218.
- Gejdenson,
Sam and Charles Schumer,1999. "Consumers Still in a Box: The High Price
of Breakfast Cereal." Agribusiness 15(2):261-271.
- Cotterill,
R.W. and A. W. Franklin. 1999. "An Estimation of Consumer BenefitsFrom
the Public Campaign to Lower Cereal Prices." Agribusiness15(2):273-287.
- Curtiss,
C. 2000.
"The economic analysis related to the CanadianWheat Board in the U.S. Countervailing
duty investigation of live cattlefrom Canada." Agribusiness
16(4):487-489.
- Carter, C. 1999. The Canadian Wheat Board and its Impact on the Price
ofFeed Barley on the Canadian Prairies. University of California-Davis.
- Schmitz,
A. and R. Gray. 2000. The Canadian Wheat Board and Barley. Agribusiness
16(4):491-501.
VIII. Industry Case Studies
- Shepherd Ch. 13, 14
- Rogers, Richard, "Broilers: Differentiating a Commodity" in L.
DuetschIndustry Studies, Prentice Hall: Englewood Cliffs,1993.
Links