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Bargaining powers and market segmentation in freight transport

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  • Michel Mouchart

    (Institut de statistique, Université catholique de Louvain, Louvain-la-Neuve, Belgium)

  • Marie Vandresse

    (Institut de démographie, Université catholique de Louvain, Belgium)

Abstract

The heterogeneity of services in the freight transport market and the presence of imperfect information motivate the development of an empirical model for detecting market imperfection and bargaining powers of the two agents concluding a contract. The fact that agents typically bargain simultaneously on price and attributes leads to models without exogeneity assumption. The model is accordingly based on estimation of the support of the joint distribution of the price and of the attributes of the transport rather than on expectation of the price conditional to the attributes. The model proposes an innovative and integrated approach for measuring market imperfection and bargaining powers. Furthermore, the paper examines the sensitivity of the results to the choice of attributes and, in order to detect potential market segmentation, to selection of the data. The empirical work is based on a new dataset obtained from a survey based on face-to-face interviews, providing data on the price and qualitative attributes of a set of actual contracts negotiated on the Belgian freight market. Copyright © 2007 John Wiley & Sons, Ltd.

Suggested Citation

  • Michel Mouchart & Marie Vandresse, 2007. "Bargaining powers and market segmentation in freight transport," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(7), pages 1295-1313.
    • Handle: RePEc:jae:japmet:v:22:y:2007:i:7:p:1295-1313
    DOI: 10.1002/jae.988
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    Cited by:

    1. Wolff, François-Charles, 2014. "Lift ticket prices and quality in French ski resorts: Insights from a non-parametric analysis," European Journal of Operational Research, Elsevier, vol. 237(3), pages 1155-1164.
    2. Ben Lakhdar, Christian & Leleu, Hervé & Vaillant, Nicolas Gérard & Wolff, François-Charles, 2013. "Efficiency of purchasing and selling agents in markets with quality uncertainty: The case of illicit drug transactions," European Journal of Operational Research, Elsevier, vol. 226(3), pages 646-657.
    3. François-Charles Wolff, 2014. "Lift ticket prices and quality in French ski resorts: Insights from a non-parametric analysis," Working Papers hal-00952999, HAL.
    4. François-Charles Wolff, 2016. "Bargaining powers of buyers and sellers on the online diamond market: a double perspective non-parametric analysis," Annals of Operations Research, Springer, vol. 244(2), pages 697-718, September.
    5. Ruben Chumpitaz & Kristiaan Kerstens & Nicholas Paparoidamis & Matthias Staat, 2010. "Hedonic price function estimation in economics and marketing: revisiting Lancaster’s issue of “noncombinable” goods," Annals of Operations Research, Springer, vol. 173(1), pages 145-161, January.
    6. Wunsch, Guillaume & Mouchart, Michel & Russo, Federica, 2012. "Functions and mechanisms in structural-modelling explanation," LIDAM Discussion Papers ISBA 2012031, Université catholique de Louvain, Institute of Statistics, Biostatistics and Actuarial Sciences (ISBA).
    7. Michel Mouchart & Marie Vandresse, 2010. "A double-frontier approach for measuring market imperfection," Annals of Operations Research, Springer, vol. 173(1), pages 137-144, January.
    8. WUNSCH, Guillaume & MOUCHART, Michel & RUSSO, Federica, 2012. "Functions and mechanisms in structural-modelling explanations," LIDAM Discussion Papers CORE 2012056, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).

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