Measuring the Market Power in the Sugar Imports Market in Iran

Abstract

Iran imports more than one third of its sugar consumption. In this paper, we test for market power in the Iranian sugar imports market using NewEmpirical Industrial Organization (NEIO) theory. We use the data for the Iranian sugar market for the period 1974-2004 to estimate the degree of the market power. Our results indicate that market power parameter in the Iran sugar imports market is 0.004. This reveales that the sugar imports market for Iran is competitive, and the behavior of price determination in this market is much closer to price taker than collusion.

Keywords

• market power
• sugar imports market
• new empirical industrial organization