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Liberalizing a distribution system: The European car market

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  • Brenkers, R
  • Verboven, Frank

Abstract

We quantify the competitive effects of removing vertical restraints, based on the recent proposals to liberalize the selective and exclusive distribution system in the European car market. We estimate a differentiated products demand system for new cars and specify a model of oligopoly pricing under the current distribution regime. We then perform several policy experiments: the creation of international intrabrand competition (cross-border trade) and a possible strenghtening of national intrabrand competition. Our approach may also be useful to assess the competitive effects of vertical restraints in other applications.

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File URL: https://lirias.kuleuven.be/bitstream/123456789/224447/1/OR_0247.pdf
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Bibliographic Info

Paper provided by Katholieke Universiteit Leuven in its series Open Access publications from Katholieke Universiteit Leuven with number urn:hdl:123456789/224447.

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Date of creation: 2002
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Handle: RePEc:ner:leuven:urn:hdl:123456789/224447

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Web page: http://www.kuleuven.be

Related research

Keywords: Distribution; Market; Effects; Proposals; Oligopoly; Applications;

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Cited by:
  1. Hellerstein, Rebecca & Villas-Boas, Sofia B, 2006. "Outsourcing and pass-through," CUDARE Working Paper Series 1016R3, University of California at Berkeley, Department of Agricultural and Resource Economics and Policy, revised Feb 2010.
  2. Raphael Anton Auer & Thomas Chaney & Philip Ulrich Sauré, 2012. "Quality Pricing-to-Market," Working Papers 2012-11, Swiss National Bank.
  3. Jorge, Sí­lvia Ferreira & Pires, Cesaltina Pacheco, 2008. "Delivered versus mill nonlinear pricing with endogenous market structure," International Journal of Industrial Organization, Elsevier, vol. 26(3), pages 829-845, May.
  4. Milliou, Chrysovalantou & Petrakis, Emmanuel, 2007. "Upstream horizontal mergers, vertical contracts, and bargaining," International Journal of Industrial Organization, Elsevier, vol. 25(5), pages 963-987, October.

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