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Abstract

This study analyzes the relationship between export market structure and the pricing behavior of U.S. grain exporting firms. A generalized theoretical model that specifies the Lerner index as a function of the Herfindahl-Hirschman index, market specific own-price elasticities of demand, and other market structure and control variables is used. The hypotheses proposed in the study are tested by OLS regression analysis using pooled cross-sectional, time series data sets for U.S. wheat and corn exports. Strong evidence suggesting that market structure does affect the pricing behavior of U.S. wheat exporting firms was found. Specifically, where export concentration is high, demand is strong, or foreign buyers have less market power, the markup on export price over domestic price is higher. Weaker evidence of systematic export price discrimination was found for corn.

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