Markets: Ready-Mixed Concrete
Journal of Economic Perspectives
vol. 22,
no. 1, Winter 2008
(pp. 217-234)
(Complimentary)
Abstract
Concrete's natural color is gray. Its favored uses are utilitarian. Its very ubiquity causes it to blend into the background. But ready-mix concrete does have one remarkable characteristic: other than manufactured ice, perhaps no other manufacturing industry faces greater transport barriers. The transportation problem arises because ready-mix concrete both has a low value-to-weight ratio and is highly perishable -- it absolutely must be discharged from the truck before it hardens. These transportation barriers mean ready-mixed concrete must be produced near its customers. For the same reason, foreign trade in ready-mixed concrete is essentially nonexistent. This article is an introduction to the basics of the market for ready-mix concrete, focusing mainly on its consumers and its producers in the United States, but with occasional comparisons to other countries when contrasts are useful.Citation
Syverson, Chad. 2008. "Markets: Ready-Mixed Concrete." Journal of Economic Perspectives, 22 (1): 217-234. DOI: 10.1257/jep.22.1.217JEL Classification
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity
- L11 Production, Pricing, and Market Structure; Size Distribution of Firms
- L14 Transactional Relationships; Contracts and Reputation; Networks
- L23 Organization of Production
- L61 Metals and Metal Products; Cement; Glass; Ceramics
- O33 Technological Change: Choices and Consequences; Diffusion Processes
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