Author： Pennerstorfer Dieter
Publisher： Springer Publishing Company
ISSN： 0570-1864
Source： The Annals of Regional Science, Vol.43, Iss.1, 2009-03, pp. : 133-158
Disclaimer: Any content in publications that violate the sovereignty, the constitution or regulations of the PRC is not accepted or approved by CNPIEC.
Abstract
This paper investigates the influence of unbranded stations on the prices charged by branded stations in the retail gasoline sector, using data on 400 stations in Lower Austria. As the market is characterized by spatial competition, a spatial lag model is used to avoid misspecification. The results show that independent retailers generally heighten price competition, as they charge significantly lower prices. At the same time, as consumers might consider gasoline sold at unbranded stations to be inferior, they also reduce price competition for branded stations. Independents therefore ultimately have only a small influence on the prices charged by branded stations.
Related content
Access to resources
Recommend
Simple monopoly price theory in a spatial market
By Hsu Song-ken
The Annals of Regional Science, Vol. 40, Iss. 3, 2006-08 ,pp. :