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An aggregate test for transient market power in the winter 2013–14 propane market

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  • Moul, Charles C.
  • Miller, Brandon A.

Abstract

The Midwest’s propane market saw significant price increases in the 2013–14 winter with attendant accusations of gouging. We estimate demand and supply to consider whether that winter’s harsh conditions and low inventories enabled distributors to exercise transient market power. Our estimates suggest that prices were 20% higher than competitive predictions.

Suggested Citation

  • Moul, Charles C. & Miller, Brandon A., 2021. "An aggregate test for transient market power in the winter 2013–14 propane market," Economics Letters, Elsevier, vol. 200(C).
    • Handle: RePEc:eee:ecolet:v:200:y:2021:i:c:s0165176521000422
    DOI: 10.1016/j.econlet.2021.109765
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    References listed on IDEAS

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    1. Severin Borenstein & James B. Bushnell & Frank A. Wolak, 2002. "Measuring Market Inefficiencies in California's Restructured Wholesale Electricity Market," American Economic Review, American Economic Association, vol. 92(5), pages 1376-1405, December.
    2. Robert H. Porter, 1983. "A Study of Cartel Stability: The Joint Executive Committee, 1880-1886," Bell Journal of Economics, The RAND Corporation, vol. 14(2), pages 301-314, Autumn.
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    Cited by:

    1. Kęstutis Peleckis, 2022. "Application of the Multicriteria Method Seeking to Assess Concentration, and Its Effects on Competition in the Manufacturing Sector," Sustainability, MDPI, vol. 14(19), pages 1-30, September.
    2. Kęstutis Peleckis, 2022. "Application of the Fuzzy VIKOR Method to Assess Concentration and Its Effects on Competition in the Energy Sector," Energies, MDPI, vol. 15(4), pages 1-16, February.

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    More about this item

    Keywords

    Transient market power; Energy economics;

    JEL classification:

    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices
    • L71 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Mining, Extraction, and Refining: Hydrocarbon Fuels
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices

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