About The Economics Of Bilateral Oligopoly Market Pricing Mechanism

The world's iron ore market is a typical bilateral Oligopoly market,where prices are determined through bargaining between the buyer and the seller at the beginning of each year.As the world biggest import country for iron ore,China has joined the bargaining process since 2004 without a corresponding bargaining power for prices.In 2008,China has even been discriminated by the upstream firms.To solve the deficiency for price fixing power,this paper first established an analysis of the industry structure for both supply and demand sides.Based on the bargain model,we then construct a theoretical model framework to discuss all possible reasons that may influence the bargaining power and the way they worked.This paper concluded by providing new perspectives on the policy issues.