Competition in Interrelated Markets: An Empirical Study

Marcus Asplund and Rickard Sandin
Additional contact information
Rickard Sandin: Department of Economics, Postal: Stockholm School of Economics, Box 6501, 113 83 Stockholm, Sweden.

No 84, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: This paper studies competition in small, concentrated and inter- related markets. Our data set consists of price information fron 543 driving schools in 250 local markets in sweden, which gives a large sample to test hypotheses on how market structure influences competition. The results show that if prices in nearby markets are low, and the distances to them are short, it reduces prices, as suggested in models of spatial competition. Moreover, we find that prices in closely located markets are interdependent. It is also shown that prices are increasing in firm concentration within a market, as most theories of oligopoly predict.

Keywords: Spatial competition; interrelated markets; oligopoly; driving schools (search for similar items in EconPapers)
JEL-codes: C24 C31 D43 L13 L84 R32 (search for similar items in EconPapers)
Pages: 27 pages
Date: 1995-11
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Published in International Journal of Industrial Organization, 1999, pages 353-369.

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Journal Article: Competition in interrelated markets: An empirical study (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0084

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