Wednesday, September 28, 2022

Market Power in the Argentine Liquid Fuels Wholesale Chain

Market Power in the Argentine Liquid Fuels Wholesale Chain

By:

M. T. Verónica Culós (Universidad Nacional de Cuyo); M. Florencia Gabrielli (Universidad Nacional de Cuyo/CONICET); Marcos Herrera Gómez (IELDE-UNSa/CONICET)

Abstract:

The liquid fuels market in Argentina is characterized by a high level of concentration, especially in local geographic areas. This paper studies the demand of the liquidfuels wholesale chain in Argentina, using the discrete choice approach, based on the premise that different firms offer differentiated goods, by virtue of the intrinsic characteristics of the good, and that such differentiation gives them the power to set prices above marginal production costs. The difference between prices and marginal costs determines the firm’s market power. Using a novel dataset, we provide new empirical evidence that quantifies market power across firms and regions.

URL:

http://d.repec.org/n?u=RePEc:aoz:wpaper:157&r=

https://lawprofessors.typepad.com/antitrustprof_blog/2022/09/market-power-in-the-argentine-liquid-fuels-wholesale-chain.html

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