Testing for Market Power in the Norwegian Primary Aluminium Industry

Kjersti-Gro Lindquist ()
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Kjersti-Gro Lindquist: Statistics Norway, https://www.ssb.no/en/forskning/ansatte

Discussion Papers from Statistics Norway, Research Department

Abstract: The hypothesis of market power in the Norwegian primary aluminium industry is tested using plant-level panel data. Economies of scale are found to be present, and Norwegian aluminium plants charge a procyclical price-cost margin that significantly exceeds zero. Consequently, the simple competitive hypothesis is rejected. The hypothesis that products are differentiated is not rejected, since several plants are found to charge a price permanently over the world market price. A decline in industry concentration internationally, which is assumed to increase the degree of competition, has no significant effect on the price-cost margins of Norwegian plants.

Keywords: Market power; Differentiated products; Aluminium industry (search for similar items in EconPapers)
JEL-codes: C23 D21 D43 L61 (search for similar items in EconPapers)
Date: 1994-11
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Citations: View citations in EconPapers (2)

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