When the residual demand curve for wheat facing the United States and Canada shifts to the left, or when the exportable surplus of Australia is large, market‐shares of these duopolists are reduced. Such circumstances lead to the formation of a market‐share triopoly with Australia. The evidence for this proposition is examined and a model of triopoly pricing in the world wheat market is presented. If major exporters continue to be concerned with relative market‐shares, the triopoly will reform, stocks will accumulate, and lower prices will prevail; however, prices will be more variable, and possibly higher, than before 1972/73.
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Alaouze et al. (1978) studied this question.
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