COVID-19, Beef Price Spreads, and Market Power
By: Azzam, Azzeddine ; Dhoubhadel, Sunil P.
Azzam, Azzeddine ; Dhoubhadel, Sunil P., COVID-19, Beef Price Spreads, and Market Power, Journal of Agricultural and Resource Economics, Volume 47, Issue 2, May 2022, Pages 462-476
The unprecedented spike in beef price spreads during the COVID-19-driven packing plant shutdowns prompted calls for investigations into Òinappropriate influenceÓ by packers in the beef market during the pandemic disruption. Using weekly data for the January 2010ÐAugust 2020 period and designating MarchÐMay 2020 as the disruption period, we estimate a structural oligopoly/oligopsony model using the generalized method of moments. We fail to reject the hypothesis of competitive pricing of beef and cattle.