Market Power of Middlemen - The Case of Quinoa in Bolivia

Sammanfattning: The role of middlemen has been much debated throughout the years. Some claim them to be greedy exploiters of poor producers while others view them as facilitators of trade. One key component for whether they have the ability to exploit producers is the market power they possess. This thesis studies the competition among middlemen in Bolivia in order to determine what market power they have. Additionally, the effectsof distance are studied to determine whether middlemen operating further away from a marketplace have stronger market power. This is done through analysis of qualitative data based on interviews on location in Bolivia with both producers and middlemen. Producers located near the marketplace sell directly to it while those located further out are dependent on middlemen. The market power of middlemen operating at the more remote distances is however determined by the competition at the marketplace. Due to specific characteristics of quinoa as well as a large increase in external demand competition among middlemen is very high throughout Bolivia.