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(No)competition in the Spanish retailing gasoline market: a variance filter approach

Juan Jiménez González () and Jordi Perdiguero ()

No XREAP2009-05, Working Papers from Xarxa de Referència en Economia Aplicada (XREAP)

Abstract: Various methodologies in economic literature have been used to analyse the international hydrocarbon retail sector. Nevertheless at a Spanish level these studies are much more recent and most conclude that generally there is no effective competition present in this market, regardless of the approach used. In this paper, in order to analyse the price levels in the Spanish petrol market, our starting hypothesis is that in uncompetitive markets the prices are higher and the standard deviation is lower. We use weekly retail petrol price data from the ten biggest Spanish cities, and apply Markov chains to fill the missing values for petrol 95 and diesel, and we also employ a variance filter. We conclude that this market demonstrates reduced price dispersion, regardless of brand or city.

Keywords: Competition; Petrol; Variance filter analysis; Gibbs sampling; Markov chain Monte Carlo. (search for similar items in EconPapers)
JEL-codes: L13 L59 L71 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2009-05, Revised 2009-05
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http://www.xreap.cat/RePEc/xrp/pdf/XREAP2009-5.pdf First version, 2009 (application/pdf)
http://www.xreap.cat/RePEc/xrp/pdf/XREAP2009-5.pdf Revised version, 2009 (application/pdf)

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