Pass-Through By Multiproduct Firms

Andre Romahn and Richard Friberg

VfS Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association

Abstract: How does cost pass-through to prices depend on the set of products a multiproduct firm owns? Using a structural demand model for the Swedish beer market, we simulate equilibrium cost pass-through for varying counterfactual ownership patterns. We find that a firm with a larger number of products in its portfolio and a higher degree of substitutability among these products adopts a lower pass-through of costs. While the direction of results is robust, our simulations show that the muting effect on pass-through is limited when comparing pass-through by stand-alone firms to pass-through under the actual, moderately concentrated, market structure.

JEL-codes: E31 L11 L13 (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-com and nep-reg
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Pass-Through by Multi-Product Firms (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc16:145692

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