Document Type

Thesis - Open Access

Award Date

2017

Degree Name

Master of Science (MS)

Department / School

Economics

First Advisor

David Davis

Keywords

WIC, Rebate Auctions, Infant formula, Alliances, market share, Sole source, Net prices, Wholesale price

Abstract

This thesis investigates the factors that affect bid decisions of infant-formula manufacturers in WIC rebates auctions. Since its inception in 1972, the WIC program has served more than half of participating women and their infants each year. Today, Infant formula - the most expensive food item on the WIC menu - is accessible to all participants for free through the WIC rebate program. Through the rebate program, firms submit bids to solely supply their infant formula to a state WIC agency at a discount leading to fall in net prices. Yet, the firms in the infant formula market are selective in the auctions they submit bids for. This study investigated the factors that influence firm’s decisions to bid as such the role of state demographics and market share in such decisions using cross sectional data spanning from 1986 to 2016 for analysis. The major findings of research include state alliance membership and firm’s market share are a primary factor when it comes to bidding decisions.

Library of Congress Subject Headings

Infant formula industry -- United States.
Infant formulas -- Prices -- United States.
Special Supplemental Food Program for Women, Infants, and Children (U.S.)
Rebates -- United States.
Nutrition policy -- United States.

Description

Includes bibliographical references (pages 56-57)

Format

application/pdf

Number of Pages

69

Publisher

South Dakota State University

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Included in

Economics Commons

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Rights Statement

In Copyright