Using Cost Pass-Through to Calibrate Demand
Nathan Miller,
Marc Remer and
Gloria Sheu
Additional contact information
Nathan Miller: Economic Analysis Group, Antitrust Division, U.S. Department of Justice
No 201209, EAG Discussions Papers from Department of Justice, Antitrust Division
Abstract:
We demonstrate that cost pass-through can be used to inform demand calibration, potentially eliminating the need for data on margins, diversion, or both. We derive the relationship between cost pass-through and consumer demand using a general oligopoly model of Nash-Bertrand competition and develop specic results for four demand systems: linear demand, logit demand, the Almost Ideal Demand System (AIDS), and log-linear demand. The methods we propose may be useful to researchers and antitrust authorities when reliable measures of margins or diversion are unavailable.
Pages: 12 pages
Date: 2012-10
New Economics Papers: this item is included in nep-com and nep-ind
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Citations: View citations in EconPapers (3)
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https://www.justice.gov/atr/public/eag/288257a.html (text/html)
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Journal Article: Using cost pass-through to calibrate demand (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:doj:eagpap:201209
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