Market power in the poultry sector in Turkey

Abstract

In 2009, the Competition Authority (CA) in Turkey penalized 27 broiler chicken producers for agreeing to restrict supply and controlling prices, hence forming a cartel. The CA based its punishment decision on communication records among major broiler chicken producers, using raw price series and without any statistical or econometric analysis. In this research, time-series methods are employed to test directly for the presence of market power along the supply 'chain in the poultry sector for both demand and supply sides. The findings show that the retail price behavior in the poultry supply chain in Turkey is consistent with an oligopolistic market structure.