OPEC's Market Power: An Empirical Dominant Firm Model for the Oil Market

Rolf Golombek, Alfonso A. Irarrazabal and Lin Ma

No 4512, CESifo Working Paper Series from CESifo

Abstract: In this paper we estimate a dominant firm-competitive fringe model for the crude oil market using quarterly data on oil prices for the 1986-2009 period. All the estimated structural parameters have the expected sign and are significant at standard test levels. We find that OPEC exercised its market power during the sample period. Counterfactual experiments indicate that world GDP is the main driver of long-run oil prices, however, supply (depletion) factors have become more important in recent years.

Keywords: oil; dominant firm; market power; OPEC; Lerner index; oil demand elasticity; oil supply elasticity (search for similar items in EconPapers)
JEL-codes: L13 L22 Q31 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: OPEC's market power: An empirical dominant firm model for the oil market (2018)
Working Paper: OPEC’s market power: An Empirical Dominant Firm Model for the Oil Market (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_4512

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