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Search and Stockpiling in Retail Gasoline Markets

Author

Listed:
  • David P. Byrne
  • Nicolas de Roos

Abstract

This note presents some simple, direct tests for search and dynamic demand behavior in retail gasoline markets. We exploit a unique market-level dataset that allows us to directly measure search intensity with daily web traffic data from a gasoline price reporting website, and perfectly measure daily changes in price levels and dispersion. We find stark evidence of both search and stockpiling behavior.

Suggested Citation

  • David P. Byrne & Nicolas de Roos, 2014. "Search and Stockpiling in Retail Gasoline Markets," Department of Economics - Working Papers Series 1181, The University of Melbourne.
    • Handle: RePEc:mlb:wpaper:1181
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    References listed on IDEAS

    as
    1. David P. Byrne, & Gordon Leslie, 2013. "How do Co nsumers Respond to Gasoline," Department of Economics - Working Papers Series 1176, The University of Melbourne.
    2. Matthew S. Lewis & Howard P. Marvel, 2011. "When Do Consumers Search?," Journal of Industrial Economics, Wiley Blackwell, vol. 59(3), pages 457-483, September.
    3. Matthew S. Lewis, 2011. "Asymmetric Price Adjustment and Consumer Search: An Examination of the Retail Gasoline Market," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 20(2), pages 409-449, June.
    4. Sam Peltzman, 2000. "Prices Rise Faster than They Fall," Journal of Political Economy, University of Chicago Press, vol. 108(3), pages 466-502, June.
    5. Babur De Los Santos & Ali Hortacsu & Matthijs R. Wildenbeest, 2012. "Testing Models of Consumer Search Using Data on Web Browsing and Purchasing Behavior," American Economic Review, American Economic Association, vol. 102(6), pages 2955-2980, October.
    6. Martin Pesendorfer, 2002. "Retail Sales: A Study of Pricing Behavior in Supermarkets," The Journal of Business, University of Chicago Press, vol. 75(1), pages 33-66, January.
    7. Jeffrey R. Brown & Austan Goolsbee, 2002. "Does the Internet Make Markets More Competitive? Evidence from the Life Insurance Industry," Journal of Political Economy, University of Chicago Press, vol. 110(3), pages 481-507, June.
    8. Øystein Foros & Frode Steen, 2013. "Vertical Control and Price Cycles in Gasoline Retailing," Scandinavian Journal of Economics, Wiley Blackwell, vol. 115(3), pages 640-661, July.
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    13. Andrew Eckert, 2013. "Empirical Studies Of Gasoline Retailing: A Guide To The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 27(1), pages 140-166, February.
    14. Nicolas de Roos & Hajime Katayama, 2013. "Gasoline Price Cycles Under Discrete Time Pricing," The Economic Record, The Economic Society of Australia, vol. 89(285), pages 175-193, June.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    search; dynamic demand; retail gasoline;
    All these keywords.

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • L8 - Industrial Organization - - Industry Studies: Services

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    This paper has been announced in the following NEP Reports:

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