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Selling gasoline as a by-product: The impact of market structure on local prices

Listed author(s):
  • Haucap, Justus
  • Heimeshoff, Ulrich
  • Siekmann, Manuel

We use a novel data set with exact price quotes from virtually all German gasoline stations to empirically investigate how a temporary variance in local market structure - induced by restricted opening hours of specific players - affects price competition. We focus on stations selling gasoline as a by-product and find that, during their exogenously determined hours of opening, they have a significant negative price effect on nearby major-brand competitors. Applying a difference-in-difference framework with hourly average prices, our findings explicitly account for counterfactual market scenarios.

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Paper provided by University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE) in its series DICE Discussion Papers with number 240.

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Date of creation: 2016
Handle: RePEc:zbw:dicedp:240
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  22. Benjamin Atkinson, 2008. "On Retail Gasoline Pricing Websites: Potential Sample Selection Biases and Their Implications for Empirical Research," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 33(2), pages 161-175, September.
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  25. Isakower, Sean & Wang, Zhongmin, 2014. "A comparison of regular price cycles in gasoline and liquefied petroleum gas," Energy Economics, Elsevier, vol. 45(C), pages 445-454.
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