SSE/EFI Working Paper Series in Economics and Finance
No 84:
Competition in Interrelated Markets: An Empirical Study
Marcus Asplund and Rickard Sandin
Abstract: This paper studies competition in small, concentrated and
inter- related markets. Our data set consists of price information fron 543
driving schools in 250 local markets in sweden, which gives a large sample
to test hypotheses on how market structure influences competition. The
results show that if prices in nearby markets are low, and the distances to
them are short, it reduces prices, as suggested in models of spatial
competition. Moreover, we find that prices in closely located markets are
interdependent. It is also shown that prices are increasing in firm
concentration within a market, as most theories of oligopoly predict.
Keywords: Spatial competition; interrelated markets; oligopoly; driving schools; (follow links to similar papers)
JEL-Codes: C24; C31; D43; L13; L84; R32; (follow links to similar papers)
27 pages, November 1995
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- This paper is published as:
-
Asplund, Marcus and Rickard Sandin, (1999), 'Competition in Interrelated Markets: An Empirical Study', International Journal of Industrial Organization, Vol. 17, pages 353-369
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