Price determination in the iron ore market

Rodgers, David Andrew. (2009). Price determination in the iron ore market Honours Thesis, , The University of Queensland.

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Author Rodgers, David Andrew.
Thesis Title Price determination in the iron ore market
Institution The University of Queensland
Publication date 2009
Thesis type Honours Thesis
Total pages 99
Language eng
Subjects 14 Economics
Formatted abstract
A model of price determination in the iron ore market is developed using the alternating offers bargaining framework of Rubinstein (1982). Extension of the model to the case of multiple iron ore suppliers is achieved through the use of the outside option principle of Binmore, Shaked and Sutton (1984b, 1985 and 1989) and related results. The effect of uncertain demand in the steel market is considered using the framework of White (2008). The qualitative predictions of the model as to price outcomes, including the effects of spot market prices and efficiency, bargaining power asymmetry, and uncertainty, upon contract prices and price homogeneity results, are found to accord with observed price outcomes. Interpretation of these effects in the context of the bargaining model provides novel explanations for some empirical relationships and highlights others for the first time.

Document type: Thesis
Collection: UQ Theses (non-RHD) - UQ staff and students only
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Created: Wed, 22 Dec 2010, 16:04:48 EST by Ning Jing on behalf of Social Sciences and Humanities Library Service