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Measuring market power when firms price discriminate

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journal contribution
posted on 2017-10-24, 10:12 authored by Levent Kutlu, Robin Sickles
© 2017, Springer-Verlag Berlin Heidelberg. We propose conduct parameter-based market power measures within a model of price discrimination, extending work by Hazledine (Econ Lett 93:413–420, 2006) and Kutlu (Econ Lett 117:540–543, 2012) to certain forms of second-degree price discrimination. We use our model to estimate the market power of US airlines in a price discrimination environment. We find that a slightly modified version of our original theoretical measure is positively related to market concentration. Moreover, on average, market power for high-end segment is greater than that of low-end segment.

History

School

  • Business and Economics

Department

  • Business

Published in

Empirical Economics

Volume

53

Issue

1

Pages

287 - 305

Citation

KUTLU, L. and SICKLES, R.C., 2017. Measuring market power when firms price discriminate. Empirical Economics, 53(1), pp. 287-305.

Publisher

© Springer Verlag

Version

  • AM (Accepted Manuscript)

Publisher statement

This work is made available according to the conditions of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0) licence. Full details of this licence are available at: https://creativecommons.org/licenses/by-nc-nd/4.0/

Publication date

2017

Notes

This is a post-peer-review, pre-copyedit version of an article published in Empirical Economics. The final authenticated version is available online at: https://doi.org/10.1007/s00181-017-1251-4

ISSN

0377-7332

Language

  • en