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Control of vehicle ownership and market competition: theory and Singapore's experience with the vehicle quota system

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  • Koh, Winston T. H.

Abstract

This paper studies the impact of vehicle quota system on the market structure of Singapore's car distributorship industry. Using recently available data, we analyzed the populations and new registrations of different brands of passenger car and motorcycle. We found an increase in market concentration in the car distributorship industry, as the market shares of the top distributors have increased steadily, even though the annual growth rate of vehicle population is capped at 3% per annum. We also found that average dealership markups for passenger cars for the period August-September 2002 are similar to those reported in earlier studies. We relate these empirical findings to a theoretical model of a differentiated-good oligopoly operating under an industry sales constraint.

Suggested Citation

  • Koh, Winston T. H., 2003. "Control of vehicle ownership and market competition: theory and Singapore's experience with the vehicle quota system," Transportation Research Part A: Policy and Practice, Elsevier, vol. 37(9), pages 749-770, November.
  • Handle: RePEc:eee:transa:v:37:y:2003:i:9:p:749-770
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    References listed on IDEAS

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    Cited by:

    1. Zhu, Shanjiang & Du, Longyuan & Zhang, Lei, 2013. "Rationing and pricing strategies for congestion mitigation: Behavioral theory, econometric model, and application in Beijing," Transportation Research Part B: Methodological, Elsevier, vol. 57(C), pages 210-224.
    2. Hao, Han & Wang, Hewu & Ouyang, Minggao, 2011. "Comparison of policies on vehicle ownership and use between Beijing and Shanghai and their impacts on fuel consumption by passenger vehicles," Energy Policy, Elsevier, vol. 39(2), pages 1016-1021, February.
    3. Lijia Tan & Lijia Wei, 2014. "Car License Auction: Theory and Experimental Evidence," Working Papers 1401, Xiamen Unversity, The Wang Yanan Institute for Studies in Economics, Finance and Economics Experimental Laboratory, revised 02 Sep 2014.
    4. Chu, Sing-Fat & Koh, Winston T. H. & Tse, Yiu Kuen, 2004. "Expectations formation and forecasting of vehicle demand: an empirical study of the vehicle quota auctions in Singapore," Transportation Research Part A: Policy and Practice, Elsevier, vol. 38(5), pages 367-381, June.
    5. Winston T.H. Koh, 2004. "Congestion Control and Vehicle Ownership Restriction: The Choice of an Optimal Quota Policy," Journal of Transport Economics and Policy, University of Bath, vol. 38(3), pages 371-402, September.

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