Ag Economics chapter 9

absolute unit-cost advantages
exsists when one nation can produce goods more cheaply than another nation
agricultural barganing associations
associations formed by producers to improve the degree of competition in markets for agriculture commodities
barriers to entry
those forces that make it difficult for firms to enter an industry
capital cost barrier
a barrier wherein the capital investment required for effecient operation is sufficiently large
cartels
copoperative pool formed by oligopolists to set an artificially high price
collusion
a situation designed to increase or maintain profits through price fixing and/or to restrict entry of new firms in an industry
countervailing actions
measures to counteract the possible adverse effects of imperfect competition
dead-weight loss
social costs of imperfect competition
differentiated product
a product that is made different from others through advertising or quality variation
economies of size
in production are said to exist if the cost per unit of output declines as the number of units increase
imperfect competition
market structure when one or more of the characteristics of perfect competition are not present
lump-sum tax
a fixed tax, irrespective of the level of output, used by regulatory agencies to eliminate or reduce the profit of a monopoly
marginal input cost
the change in cost of a resource used in production as more of this resource is employed
marketing orders
arrangements among producers and processers of agricultural commodities in which the chief goal is to improve producer income through the orderly marketing of a commoity
mergers and acquitions
refers to two different ways in which one business takes ownership and control of another business
monopolistic competition
a market structure in which a large number of firms produce a differentiated product. it is relatively easy to enter a sector
monopoly
a market structure that has only one firm selling to buyers
monosponistic exploitation
the difference between the prices paid for an input under perfect competition and monospony
monospony
a market structure that has only one firm buying from sellers
nonprice competition
attemps to increase the demand for a product or service via product differentiation and to make the demand for the product less price elastic
oligopoly
a market structure in which there are a small numer of sellers. each seller or oligopolist knows how the other sellers will respond to any changes in quantity marketed or prices he or she might initiate
oligopsony
a market structure in which there are a small number of buyers. each buyer or oligopsonist knows how the other buyers will respond to any changes in quantity marketed or prices he or she might initiate
monopsonistic competition
a market structure in which there are a large number of buyers of resources, but there exsists the capacity of buyers to differentiate services
Sherman Antitrust Act of 1890
a legislative act passed by Congress in 1890 in an attempt to minimize the potential social costs of imperfect competition. This act explicitly prohibited monopoly and other restrictive business practices.
Clayton Act of 1914
a legislative act passed by congress in 1914 attempting to minimize the potential social costs of imperfect competition. This act created the Federal Trade Commission, charged with the responsibility of investigating business organizations and practices in order to insure competitive practices.
Capper Volstead Act of 1922
exempted cooperatives from certain restraints imposed by the Sherman Antitrust Act of 1890 and the Clayton Act of 1914.
packers and Stockyards Act of 1921
a legislative act favorable to agricultural organizations passed by congress in 1921. This law reinforced anti trust laws regarding livestock marketing.
Cooperative marketing act of 1926
a legislative act favorable to agricultural organizations passed by congress in 1926. This law permitted farmers or their associations to acquire, exchange, and disseminate a variety of price and market information.
Robinson-patman Act of 1936
a legislative act favorable to agricultural organizations passed by congress in 1936. This law primarily covered price discrimination practices.
Agricultural Marketing Agreement Act of 1937
a legislative act passed by congress in 1937. This law established agricultural marketing orders. marketing orders and agreements refer to arrangements among producers and processors of agricultural commodities.
Preferential government policies
may take the form of tax incentives or other measures that provide firms with a competitive advantage.