Competition, collusion and spatial sales patterns : theory and evidence


Hunold, Matthias ; Hüschelrath, Kai ; Laitenberger, Ulrich ; Muthers, Johannes


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URL: https://ub-madoc.bib.uni-mannheim.de/43564
URN: urn:nbn:de:bsz:180-madoc-435641
Document Type: Working paper
Year of publication: 2017
The title of a journal, publication series: ZEW Discussion Papers
Volume: 17-035
Place of publication: Mannheim
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: K21 , L11 , L41 , L61,
Keywords (English): Capacity constraints , cartel , cement , transport costs
Abstract: We study competition in markets with significant transport costs and capacity constraints. We compare the cases of price competition and coordination in a theoretical model and find that when firms compete, they more often serve more distant customers that are closer to plants of competitors. By means of a rich micro-level data set of the cement industry in Germany, we provide empirical evidence in support of this result. Controlling for other potentially confounding factors, such as the number of production plants and demand, we find that the transport distances between suppliers and customers were on average significantly lower in cartel years than in non-cartel years.

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Hunold, Matthias ; Hüschelrath, Kai ; Laitenberger, Ulrich ; Muthers, Johannes (2017) Competition, collusion and spatial sales patterns : theory and evidence. Open Access ZEW Discussion Papers Mannheim 17-035 [Working paper]
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