â€œIneffectiveâ€ competition: a puzzle?

Conventionally, we think of an increase in competition as weakly decreasing prices, increasing the number of consumers served, thus increasing consumer surplus, decreasing firms profits, etc. Here, we demonstrate that, under some tame circumstances, an increase in competition may lead to a price increase in a horizontally differentiated market. We show this relationship for the petrol market in German cities.

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Year of publication:	2006-05
Authors:	Ivanov, Andrey V. ; Mueller, Florian
Institutions:	Volkswirtschaftliche Fakultät, Ludwig-Maximilians-Universität München

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Extent:	application/pdf
Series:	Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems.
Type of publication:	Book / Working Paper
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005835216