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Analyzing Competition Dynamics at NY's Fulton Fish Market

This study delves into the competitive landscape of Fulton Fish Market, exploring the interactions between customers, dealers, and fishermen. It highlights the dynamics of price discrimination among buyers, the influence of the Mafia on market operations, and the limited social contact that leads to price variability. Observations reveal a predominantly male cast of players and a significant presence of Asian buyers. The findings underscore the complexities of market competition, with implications for future studies in similar environments.

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Analyzing Competition Dynamics at NY's Fulton Fish Market

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  1. Testing for Imperfect Competition NY’s Fulton Fish Market

  2. Take an obviously Competitive Market • Study the players: • Customers • Dealers • Fishermen

  3. Fulton Fish Market • Look for collusion on the part of buyers or sellers • Note buyers: race, price, cash or credit • Dealers uniformly white • Players are uniformly Male

  4. Fulton Fish Market • Fishermen bring in their catches of whitfish by 5 AM Monday thru Friday • Dealers are selling 60lb boxes of fish • Sell to buyers for 1 chain store, and many small stores and Fry shops in the area • Market hours are 5 to 7 AM

  5. Competitive ? • Buyers who are equally costly to service pay different prices. • 3rd Degree price discrimination

  6. Mafia ? • The docks are controlled by the Mafia • All loading and unloading • Ease of entry…

  7. Dealers • 6 Whitfish dealers • Graddy was permitted at one

  8. Price Discrimination • Enabling Environment • - No arbitrage – little social contact • - Buyers unaware of others prices

  9. Demand • Loglinear of price • Log P = a + a log Q + e

  10. Marginal Cost • Weather is the primary determinant of the fishes value; harsher the higher • MC = MC(q, W) • Prices vary from 70 cents/lb to 1.75/lb

  11. Conclusions • 1. Karen is only woman in market • 2. One dealer was observed • 3. Dealers don’t fish; fishermen don’t deal • 4. Dealers have own marginal costs • 5. Market is more an auction of derivatives • 6. Asian buyers buy 69% • 7. White buyers buy 27%

  12. New Study? • I suggest a new study in either Los Angeles’ Grand Market • Or LA’s Fashion district alley • One with many buyers and sellers

  13. Milton Friedman • 1912 – 2006

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