Detecting Collusion in Spatially Differentiated Markets

Firgo, Matthias and Kügler, Agnes (2014) Detecting Collusion in Spatially Differentiated Markets. Department of Economics Working Paper Series, 188. WU Vienna University of Economics and Business, Vienna.


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The empirical literature on mergers, market power and collusion in differentiated markets has mainly focused on methods relying on output and/or panel data. In contrast to this literature we suggest a novel approach that allows for the detection of collusive behavior among a group of firms making use of information on the spatial structure of horizontally differentiated products. By estimating best response functions using a spatial econometrics approach, we focus on differences in the strategic interaction in pricing between different groups of firms as well as on differences in price levels. We apply our method to the market for ski lift tickets using a unique data set on ticket prices and detailed resort-specific characteristics covering all ski resorts in Austria. (authors' abstract)

Item Type: Paper
Keywords: tacit collusion / strategic alliances / spatial differentiation / ski lift ticket prices / Preisabsprache / Skilift / Strategische Allianz
Classification Codes: RVK QR 400 ; JEL C21, D43, L11, L41, L83, R32
Divisions: Departments > Volkswirtschaft
Depositing User: Claudia Tering-Raunig
Date Deposited: 11 Nov 2014 12:47
Last Modified: 22 Oct 2019 00:40


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