Oil market dynamics: A Markow chain analysis
Since the seventies the Organization of Petroleum Exporting Countries (OPEC) has exercised a monopolistic power playing a dominant role in the oil market, but with varying degrees of influence. The aim of this investigation is to determine which variables explain changes in OPEC’s market power during the last three decades, based on the assumption that oil market participants compete to maximize their market share in time. In particular, the estimation model assumes that the market participation of the two principal oil exporting country groups (OPEC and Non OPEC) follows an Autoregressive First Order Markov Process, in which transition probabilities vary in time by means of a logistic smooth transition function. Results suggest that the level of real oil prices and economic cycles are relevant variables to explain changes in market share dynamic.
Volume (Year): 33 (2008)
Issue (Month): 25 (january-june)
|Contact details of provider:|| Postal: Facultad de Ciencias Económicas y Sociales. Instituto de Investigaciones Económicas y Sociales. Campus Universitario Liria, Edificio G, Tercer Nivel. Mérida 5101, Estado Mérida, Venezuela|
Phone: +58 74 401111 ext. 1081
Fax: +58 74 401120
Web page: http://iies.faces.ula.ve/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lester C. Hunt & Guy Judge & Yasushi Ninomiya, 2003.
"Modelling underlying energy demand trends,"
in: Energy in a Competitive Market, chapter 9
Edward Elgar Publishing.
- Lester C Hunt & Guy Judge & Yasushi Ninomiya, 2003. "Modelling Underlying Energy Demand Trends," Surrey Energy Economics Centre (SEEC), School of Economics Discussion Papers (SEEDS) 105, Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.
- Ramcharran, Harri, 2002. "Oil production responses to price changes: an empirical application of the competitive model to OPEC and non-OPEC countries," Energy Economics, Elsevier, vol. 24(2), pages 97-106, March.
- S. Gurcan Gulen, 1996.
"Is OPEC a Cartel? Evidence from Cointegration and Causality Tests,"
The Energy Journal,
International Association for Energy Economics, vol. 0(Number 2), pages 43-57.
- Salih Gurcan Gulen, 1996. "Is OPEC a Cartel? Evidence from Cointegration and Causality Tests," Boston College Working Papers in Economics 318., Boston College Department of Economics.
- John C.B. Cooper, 2003. "Price elasticity of demand for crude oil: estimates for 23 countries," OPEC Energy Review, Organization of the Petroleum Exporting Countries, vol. 27(1), pages 1-8, 03.
- Kosobud, Richard F & Stokes, Houston H, 1978. "Oil Market Share Dynamics: A Markov Chain Analysis of Consumer and Producer Adjustments," Empirical Economics, Springer, vol. 3(4), pages 253-75.
- Riccardo Cesari, 1994. "A generalized measure of competition," Working Papers 204, Dipartimento Scienze Economiche, Universita' di Bologna.
- Manishi Prasad & Peter Wahlqvist & Rich Shikiar & Ya-Chen Tina Shih, 2004. "A," PharmacoEconomics, Springer Healthcare | Adis, vol. 22(4), pages 225-244.
- Lucas, Robert E., 1977. "Understanding business cycles," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 5(1), pages 7-29, January.
- James L. Smith, 2003.
"Inscrutable OPEC? Behavioral Tests of the Cartel Hypothesis,"
0305, Massachusetts Institute of Technology, Center for Energy and Environmental Policy Research.
- James L. Smith, 2005. "Inscrutable OPEC? Behavioral Tests of the Cartel Hypothesis," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 51-82.
- Gately, D. & Huntington, H.G., 2001.
"The Asymmetric Effects of Changes in Price and Income on Energy and Oil Demand,"
01-01, C.V. Starr Center for Applied Economics, New York University.
- Dermot Gately & Hiliard G. Huntington, 2002. "The Asymmetric Effects of Changes in Price and Income on Energy and Oil Demand," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 19-55.
- Greene, David L & Jones, Donald W & Leiby, Paul N, 1998. "The outlook for US oil dependence," Energy Policy, Elsevier, vol. 26(1), pages 55-69, January.
- Greene, David L., 1991. "A note on OPEC market power and oil prices," Energy Economics, Elsevier, vol. 13(2), pages 123-129, April.
- Karp, Larry & Newbery, David M, 1991. "OPEC and the U.S. Oil Import Tariff," Economic Journal, Royal Economic Society, vol. 101(405), pages 303-13, March.
- MacRae, Elizabeth Chase, 1977. "Estimation of Time-Varying Markov Processes with Aggregate Data," Econometrica, Econometric Society, vol. 45(1), pages 183-98, January.
- Adelman, Morris Albert, 1986. "Scarcity and World Oil Prices," The Review of Economics and Statistics, MIT Press, vol. 68(3), pages 387-97, August.
- Vickers, John, 1995. "Concepts of Competition," Oxford Economic Papers, Oxford University Press, vol. 47(1), pages 1-23, January.
When requesting a correction, please mention this item's handle: RePEc:ula:econom:v:33:y:2008:i:25:p:87-115. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alexis Vásquez)
If references are entirely missing, you can add them using this form.