Agenda du séminaire Paris Trade Seminar
Paris Trade Seminar
Le 07/05/2024 de 14:30:00 à 16:00:00
PSE, 48 boulevard Jourdan, 75014 Paris, salle R2-01
Separately measuring firm buyer and seller power is important for policy-making, but chal-
lenging. In this paper, we suggest a new methodology to do so and apply it to French dairy
processors. These firms exert buyer power when purchasing raw milk, and seller power when
marketing dairy products. The analysis is based on plant-level data on dairy firms, with obser-
vations on prices and quantities of raw-milk input by origin and output by product from 2003
to 2018. We rely on a production function approach to estimate total margins. The existence
of a commodity, (i) substitutable as an input or as an output, and (ii) exchanged on global
markets where firms are price-takers, allows us to separately estimate firm-origin markdowns
and firm-product markups. We show this methodology can also be useful in other contexts,
with more limited data. Markdown estimates imply that dairy firms on average purchase raw
milk at a price 16% below its marginal contribution to their profits, while markup estimates
indicate that firms sell dairy products at a price exceeding their marginal costs by 41%. Our re-
sults show substantial variations in buyer and seller power exploitation across firms, products,
and time. We analyze how shocks to local farmer costs and international commodity prices
pass through the supply chain. Processors partially absorb such shocks by adjusting markups
and markdowns, thus smoothing variations in farmer revenues. It further implies that 65% of
subsidies are currently diverted from farmers due to processor buyer power. A price floor on
raw milk could be an alternative welfare-improving policy.
GUIGUE Etienne (ENSAE) Markups and Markdowns in the French Dairy Market
écrit avec Rémi Avignon
Texte intégral
Paris Trade Seminar
Le 21/05/2024 de 14:30:00 à 16:00:00
PSE, 48 boulevard Jourdan, 75014 Paris, salle R2-01
Since the 18th century, policymakers have debated the merits of industrial policy
(IP). Yet, economists lack basic facts about its use. This study sheds light on
industrial policy by measuring and studying global policy practice for the first
time. We first create an automated classification algorithm for categorizing
industrial policy practice from text. We then apply it to a global database of
commercial policy descriptions and quantify policy use at the country, industry,
and year levels (2009-2020). These data allow us to study fundamental policy
patterns across the world. We highlight four findings. First, IP is common (25%
of policies in our database) and has expanded since 2010. Second, instead of
blunt tariffs, IP is granular and technocratic. Countries tend to use subsidies
and export promotion measures, often targeted at individual firms. Third, the
countries engaged most in IP tend to be wealthier (top income quintile) liberal
democracies. In our data, IP is rarer among the poorest nations (bottom quintile).
Fourth, IP is targeted toward a subset of industries and is highly correlated with
an industry’s revealed comparative advantage. We show that industrial policy is
a prominent feature of the global economy and a far cry from industrial policies
of the past.
JUHASZ Reka (UBC) The Who, What, When, and How of Industrial Policy: A Text-Based Approach
écrit avec Nathan Lane, Emily Oehlsen and Verónica C. PérezTexte intégral