Detecting Collusion in Spatially Differentiated Markets

Matthias Firgo, Agnes Kügler

Publication: Working/Discussion PaperWU Working Paper

44 Downloads (Pure)

Abstract

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)
Original languageEnglish
Place of PublicationVienna
PublisherWU Vienna University of Economics and Business
DOIs
Publication statusPublished - 1 Oct 2014

Publication series

SeriesDepartment of Economics Working Paper Series
Number188

WU Working Paper Series

  • Department of Economics Working Paper Series

Cite this