The investigator proposes to determine the relationship between market structure (concentration, costs, entry barriers and product differentiation) and economic performance (profits, prices, efficiency, growth and welfare) in U.S. food industries. The research will address the shortcomings of existing market behavior studies by initiating time-series analysies of specific food industries. The planning stages will be limited to the potato industry but it will expand to two additional food industries in the expanded proposal. This planning grant is intended to generate resources for collecting data, developing appropriate research methods and identifying food industries with meaningful databases. These activities will be facilitated by collaboration with a recently formed Northeast-165 regional committee, Private Strategies, Public Policies and Food System performance. It is expected that significant changes in the amount of concentration (structure) and contracting (organization) in the potato industry should provide meaningful data for testing theories which predict different relationships between structure and performance. Further, available data on firms performance by size should allow for testing the role of strategic groups within industries.
