IDEAS home Printed from https://ideas.repec.org/a/aen/journl/ej39-si1-contin-pilart.html
   My bibliography  Save this article

Pricing and Margins in the Retail Automotive Fuel Market: Empirical Evidence from Spain

Author

Listed:
  • Alejandro Bello, Ignacio Contín-Pilart, and M Blanca Palacios

Abstract

This paper analyses the evolution of gross retail margins for automotive fuels in Spain between January 2001 and February 2013. We firstly empirically test for breaks in the time series of gross margins. Our results indicate that there is only one break-point, in mid-2008, just when the demand for automotive fuels drops due to the economic crisis and the difference between the Spanish and the European retail margins increase notably. In addition, a regression analysis shows that the gross retail margins were higher during the recessive period of the Spanish economy (2008-2013) than before. Furthermore, we examine the causes of the break-point and of the subsequent evolution of margins. We find no evidence to support either the prohibition of using retail price maintenance (RPM) and recommended prices in the supply contracts or a supply cost change of automotive fuels as the cause of the evolution of retail margins. In addition, empirical evidence indicates that retail prices respond symmetrically to changes in wholesale prices. Instead, we show that the data are consistent with some firms exercising market power during the recessive period of the Spanish economy.

Suggested Citation

  • Alejandro Bello, Ignacio Contín-Pilart, and M Blanca Palacios, 2018. "Pricing and Margins in the Retail Automotive Fuel Market: Empirical Evidence from Spain," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    • Handle: RePEc:aen:journl:ej39-si1-contin-pilart
    as

    Download full text from publisher

    File URL: http://www.iaee.org/en/publications/ejarticle.aspx?id=3204
    Download Restriction: Access to full text is restricted to IAEE members and subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Balaguer, Jacint & Ripollés, Jordi, 2020. "Do classes of gas stations contribute differently to fuel prices? Evidence to foster effective competition in Spain," Energy Policy, Elsevier, vol. 139(C).
    2. Perdiguero, Jordi & Jiménez, Juan Luis, 2021. "Price coordination in the Spanish oil market: The monday effect," Energy Policy, Elsevier, vol. 149(C).

    More about this item

    JEL classification:

    • F0 - International Economics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aen:journl:ej39-si1-contin-pilart. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: David Williams (email available below). General contact details of provider: https://edirc.repec.org/data/iaeeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.