Market Concentration and Product Variety under Spatial Competition: Evidence from Retail Gasoline

We show that for a spatially differentiated economy reduced product variety is the likely outcome of mergers except in cases where exit costs in relation to (outlet-specific) fixed costs are high. Our empirical analysis of the Austrian retail gasoline market confirms that increases in concentration reduce product variety. Ignoring this product variety effect is likely to lead to an underestimate of market power in structural merger analysis.

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Year of publication:	2004
Authors:	Goetz, Georg ; Gugler, Klaus
Institutions:	CESifo
Subject:	spatial product differentiation \| retail gasoline \| mergers \| concentration

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Extent:	application/pdf
Series:	CESifo Working Paper Series.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 1289
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005406362