Using new empirical institutional organization (NEIO) framework, thisrnstudy examine the market behavior of processing firms in the food andrnbeverages industries in Ethiopia. to this end we tests the hypothesis ofrnprice taking behavior of 13 Ethiopian food and beverages manufacturingrnindustries for the period 1996/97 to 2004/05. the estimated conjecturalrnvariation elasticities and lerener indices indicated that the sector wasrnanti-competitive in the period under analysis.