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Retail Gasoline Price Cycles: Evidence from Guelph, Ontario Using Bi-Hourly, Station-Specific Retail Price Data

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  • Benjamin Atkinson

Abstract

This paper uses prices that were directly observed at 27 gasoline stations in Guelph, Ontario, eight times per day for 103 days in late-2005, to examine several basic predictions of a theory of price cycles. It is found that price movements in Guelph are more consistent with the Edgeworth cycle theory than with other dynamic pricing theories. The data also identify some interesting (and somewhat systematic) pricing patterns that have not been identified in previous studies, and which would likely be overlooked with less complete data. These findings are not only of interest to applied economists and policymakers, but also to theoreticians who are interested in refining the theory to make more accurate predictions.

Suggested Citation

  • Benjamin Atkinson, 2009. "Retail Gasoline Price Cycles: Evidence from Guelph, Ontario Using Bi-Hourly, Station-Specific Retail Price Data," The Energy Journal, , vol. 30(1), pages 85-110, January.
    • Handle: RePEc:sae:enejou:v:30:y:2009:i:1:p:85-110
    DOI: 10.5547/ISSN0195-6574-EJ-Vol30-No1-4
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    References listed on IDEAS

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    4. Maskin, Eric & Tirole, Jean, 1988. "A Theory of Dynamic Oligopoly, II: Price Competition, Kinked Demand Curves, and Edgeworth Cycles," Econometrica, Econometric Society, vol. 56(3), pages 571-599, May.
    5. Andrew Eckert & Douglas S. West, 2004. "A tale of two cities: Price uniformity and price volatility in gasoline retailing," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 38(1), pages 25-46, March.
    6. Sen, Anindya, 2003. "Higher prices at Canadian gas pumps: international crude oil prices or local market concentration? An empirical investigation," Energy Economics, Elsevier, vol. 25(3), pages 269-288, May.
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