IDEAS home Printed from https://ideas.repec.org/a/wly/mgtdec/v23y2002i4-5p171-186.html
   My bibliography  Save this article

Why do gas prices vary, or towards understanding the micro-structure of competition

Author

Listed:
  • Philip Bromiley

    (Department of Strategic Management, University of Minnesota, 321 19th Avenue South, Minneapolis, MN 55455, USA)

  • Chris Papenhausen

    (Department of Strategic Management, University of Minnesota, 321 19th Avenue South, Minneapolis, MN 55455, USA)

  • Patricia Borchert

    (Department of Strategic Management, University of Minnesota, 321 19th Avenue South, Minneapolis, MN 55455, USA)

Abstract

Strategic management work on competition considers industry segments or industries for the most part. We argue that real competition occurs at much lower levels of aggregation in many industries: what we term the micro-structure of competition. Micro-structures arise from boundedly rational firms searching imperfectly for business opportunities and boundedly rational consumers searching in a behaviorally determined manner for products and services. This paper lays out the basics of the micro-structural approach to competitive analysis and presents initial propositions from that approach. Copyright © 2002 John Wiley & Sons, Ltd.

Suggested Citation

  • Philip Bromiley & Chris Papenhausen & Patricia Borchert, 2002. "Why do gas prices vary, or towards understanding the micro-structure of competition," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 23(4-5), pages 171-186.
  • Handle: RePEc:wly:mgtdec:v:23:y:2002:i:4-5:p:171-186
    DOI: 10.1002/mde.1060
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1002/mde.1060
    File Function: Link to full text; subscription required
    Download Restriction: no

    File URL: https://libkey.io/10.1002/mde.1060?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Thomas H. Brush & Philip Bromiley, 1997. "What does a small corporate effect mean? A variance components simulation of corporate and business effects," Strategic Management Journal, Wiley Blackwell, vol. 18(10), pages 825-835, November.
    2. Stigler, George J., 2011. "Economics of Information," Ekonomicheskaya Politika / Economic Policy, Russian Presidential Academy of National Economy and Public Administration, vol. 5, pages 35-49.
    3. Assaf Razin & Efraim Sadka, 1995. "Population Economics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262181606, April.
    4. Dan Schendel, 1991. "Editor's comments on the winter special issue," Strategic Management Journal, Wiley Blackwell, vol. 12(S2), pages 1-3, December.
    5. Shepard, Andrea, 1990. "Pricing Behavior and Vertical Contracts in Retail Markets," American Economic Review, American Economic Association, vol. 80(2), pages 427-431, May.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Daniel Albalate & Jordi Perdiguero, 2012. "“Entry Regulation Asymmetries and Gasoline Competition in a Mixed Motorway Network”," IREA Working Papers 201218, University of Barcelona, Research Institute of Applied Economics, revised Nov 2012.
    2. Juan Jiménez & Jordi Perdiguero, 2011. "Does Accessibility Affect Retail Prices and Competition? An Empirical Application," Networks and Spatial Economics, Springer, vol. 11(4), pages 677-699, December.
    3. Erdem Dogukan Yilmaz & Ivana Naumovska & Milan Miric, 2023. "Does imitation increase or decrease demand for an original product? Understanding the opposing effects of discovery and substitution," Strategic Management Journal, Wiley Blackwell, vol. 44(3), pages 639-671, March.
    4. Jukka Luoma & Sampsa Ruutu & Adelaide Wilcox King & Henrikki Tikkanen, 2017. "Time delays, competitive interdependence, and firm performance," Strategic Management Journal, Wiley Blackwell, vol. 38(3), pages 506-525, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alberto Chong & Virgilio Galdo & Máximo Torero, 2005. "Does Privatization Deliver? Access to Telephone Services and Household Income in Poor Rural Areas Using a Quasi-Natural Experiment in Peru," Research Department Publications 4417, Inter-American Development Bank, Research Department.
    2. Steinmetz, Alexander, 2010. "Price and inventory dynamics in an oligopoly industry: A framework for commodity markets," W.E.P. - Würzburg Economic Papers 82, University of Würzburg, Department of Economics.
    3. J. K. Pappalardo, 2022. "Economics of Consumer Protection: Contributions and Challenges in Estimating Consumer Injury and Evaluating Consumer Protection Policy," Journal of Consumer Policy, Springer, vol. 45(2), pages 201-238, June.
    4. Feser, Daniel & Runst, Petrik, 2015. "Energy efficiency consultants as change agents? Examining the reasons for EECs’ limited success," ifh Working Papers 1 (2015), Volkswirtschaftliches Institut für Mittelstand und Handwerk an der Universität Göttingen (ifh).
    5. Oliver Hinz & Jochen Eckert, 2010. "The Impact of Search and Recommendation Systems on Sales in Electronic Commerce," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 2(2), pages 67-77, April.
    6. Alexander W. Salter & William J. Luther, 2016. "The Optimal Austrian Business Cycle Theory," Advances in Austrian Economics, in: Studies in Austrian Macroeconomics, volume 20, pages 45-60, Emerald Group Publishing Limited.
    7. Nagler Matthew G., 2007. "Understanding the Internet's Relevance to Media Ownership Policy: A Model of Too Many Choices," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 7(1), pages 1-28, June.
    8. Laband, David N. & Hussain, Anwar & González-Cabán, Armando, 2008. "The impact of forest service litigation success on administrative appeals of proposed fuels reduction actions," Forest Policy and Economics, Elsevier, vol. 10(7-8), pages 444-449, October.
    9. Bellini, Silvia & Cardinali, Maria Grazia & Grandi, Benedetta, 2017. "A structural equation model of impulse buying behaviour in grocery retailing," Journal of Retailing and Consumer Services, Elsevier, vol. 36(C), pages 164-171.
    10. Castilla, Carolina & Haab, Timothy C., 2010. "Asymmetric Search and Loss Aversion: Choice Experiment on Consumer Willingness to Search in the Gasoline Retail Market," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61672, Agricultural and Applied Economics Association.
    11. Dhaval M. Dave, 2013. "Effects of Pharmaceutical Promotion: A Review and Assessment," NBER Working Papers 18830, National Bureau of Economic Research, Inc.
    12. Andrew Caplin & Mark Dean & Daniel Martin, 2011. "Search and Satisficing," American Economic Review, American Economic Association, vol. 101(7), pages 2899-2922, December.
    13. Tan Wang & Tony S. Wirjanto, 2016. "Risk Aversion, Uncertainty, Unemployment Insurance Benefit and Duration of "Wait" Unemployment," Annals of Economics and Finance, Society for AEF, vol. 17(1), pages 1-34, May.
    14. repec:bla:germec:v:1:y:2000:i:2:p:221-240 is not listed on IDEAS
    15. Hakan Yilmazkuday, 2017. "Geographical dispersion of consumer search behaviour," Applied Economics, Taylor & Francis Journals, vol. 49(57), pages 5740-5752, December.
    16. Lars Ljungqvist, 2002. "How Do Lay--off Costs Affect Employment?," Economic Journal, Royal Economic Society, vol. 112(482), pages 829-853, October.
    17. Gabre-Madhin, Eleni Z., 2001. "Market institutions, transaction costs, and social capital in the Ethiopian grain market:," Research reports 124, International Food Policy Research Institute (IFPRI).
    18. Kozloff, Keith, 1990. "An Evaluation Of Options For Micro-Targeting Acquisition Of Cropping Rights To Reduce Nonpoint Source Water Pollution," Staff Papers 13610, University of Minnesota, Department of Applied Economics.
    19. Rodríguez, Elsa Mirta M. & Lacaze, María Victoria & Lupín, Beatriz, 2007. "Willingness to pay for organic food in Argentina: evidence from a consumer survey," Nülan. Deposited Documents 1300, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    20. Mahesh Balan U & Saji K. Mathew, 2021. "Personalize, Summarize or Let them Read? A Study on Online Word of Mouth Strategies and Consumer Decision Process," Information Systems Frontiers, Springer, vol. 23(3), pages 627-647, June.
    21. Samek, Anya & Hur, Inkyoung & Kim, Sung-Hee & Yi, Ji Soo, 2016. "An experimental study of the decision process with interactive technology," Journal of Economic Behavior & Organization, Elsevier, vol. 130(C), pages 20-32.

    More about this item

    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:wly:mgtdec:v:23:y:2002:i:4-5:p:171-186. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Wiley Content Delivery (email available below). General contact details of provider: http://www3.interscience.wiley.com/cgi-bin/jhome/7976 .

    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.