The Competitive Structure of U.S. Agricultural Exports

Abstract

Abstract The competitive structure of U.S. agricultural exports is examined using a model of exporter behavior based on pricing decisions across destination markets. Market power is revealed in the adjustment patterns of export prices in response to exchange rate movements. The results reject the hypothesis that the export pricing decisions by U.S. firms are consistent with price discrimination across destination markets for cotton, corn, and soybeans. The strongest evidence against the competitive market structure is obtained for international trade in wheat, where results indicate that the two largest importers (Soviet Union and PRC) may exert market power to obtain lower prices.