Market Power and World Price: The Role of Asian Rice Exporters

An attempt has been made in this study to assess the market power of major Asian exporters in world rice market using standard oligopoly models. Quantity has been used as the strategic variable based on previous literature. Structural and reduced form approaches have been used. Results indicate that the major Asian rice exporters like Thailand, China, and India face a downward sloping demand curve whereas the United States does not appear to possess market power. However, the results are inconclusive about the precise market structure. The results, in the backdrop of the history of world rice markets, indicate a need for Asian exporters to rely more on trade than on domestic stocks in order to reduce the thinness of world rice market.