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Imperfect Competition Models and Commodity Promotion Evaluation: The Case of U.S. Generic Milk Advertising

Published online by Cambridge University Press:  28 April 2015

Nobuhiro Suzuki  and
Harry M. Kaiser
Nobuhiro Suzuki
Affiliation:
National Research Institute of Agricultural Economics, Japanese Ministry of Agriculture, Forestry, and Fisheries
Harry M. Kaiser
Affiliation:
Cornell Commodity Promotion Research Program in the Department of Agricultural, Ref source, and Managerial Economics, Cornell University
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Abstract

This article examines whether the assumption of perfect competition in the U.S. dairy industry biases the findings of economic impacts of generic dairy advertising. An imperfect competition model based on an approach similar to that of Appelbaum is developed and used to evaluate generic milk advertising. The results are compared with a perfect competition model. The findings indicate positive price and quantity impacts due to generic advertising. The differences in magnitude of impacts between the two models are small, suggesting that the assumption of perfect competition for U.S. dairy models is plausible.

Keywords

evaluationgeneric milk advertisingimperfect competition model
Type
Articles
Information
Journal of Agricultural and Applied Economics , Volume 29 , Issue 2 , December 1997 , pp. 315 - 325
Copyright
Copyright © Southern Agricultural Economics Association 1998

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