Title

Slotting allowances as a facilitating practice by food processors in wholesale grocery markets: Profitability and welfare effects

Authors

Authors

S. F. Hamilton

Comments

Authors: contact us about adding a copy of your work at STARS@ucf.edu

Abbreviated Journal Title

Am. J. Agr. Econ.

Keywords

oligopsony; rent-shifting; slotting allowances; vertical market; structure; IMPERFECT COMPETITION; PRODUCT INTRODUCTIONS; OLIGOPSONY; CHANNEL; Agricultural Economics & Policy; Economics

Abstract

Slotting allowances, which are lump-sum transfers paid by food manufacturers to grocery retailers in return for various retail concessions, are becoming increasingly common in wholesale grocery markets. This article extends the literature on slotting allowances by considering two features that previously have been ignored: the role of food processors in determining these pricing arrangements, and the effect of slotting allowances on the size and distribution of economic surplus. Slotting allowances motivated by food processors increase procurement quantities and farm prices, and this raises farm surplus, increases total producer surplus, and improves consumer welfare in the food system.

Journal Title

American Journal of Agricultural Economics

Volume

85

Issue/Number

4

Publication Date

1-1-2003

Document Type

Article

DOI Link

http://dx.doi.org/10.1111/1467-8276.00489

Language

English

First Page

797

Last Page

813

WOS Identifier

WOS:000186274300001

ISSN

0002-9092

Recommended Citation

"Slotting allowances as a facilitating practice by food processors in wholesale grocery markets: Profitability and welfare effects" (2003). Faculty Bibliography 2000s. 3794.
https://stars.library.ucf.edu/facultybib2000/3794