how does advertising depend on competition evidence from u s brewing the relationship between market structure and advertising has been extensively studied but has generated sharply opposing theoretical predictions as well as inconclusive empirical findings likely because of severe endogeneity concerns we exploit the 2008 merger of miller and coors in the u s brewing industry to examine how changes in local concentration affect firms advertising behavior well established regional preferences over beer brands and the sharp increase in concentration from the merger make this an excellent setting to analyze this question we find a significant positive effect of local market concentration on advertising expenditures a 100 point increase in the herfindahl hirschmann index measure of concentration increases advertising per capita by about 5 our findings shed light on how and when firms choose to deploy advertising the online appendix is available at https doi org 10 1287 mnsc 2017 2889 this paper was accepted by eric anderson marketing

how should commodities be taxed market structure product heterogeneity and the optimal structure of commodity taxes abstract this paper is concerned with the form in which commodity taxes are best imposed and particularly with the appropriate balance between specific and ad valorem components this neglected issue is of policy importance in relation to the harmonization of tax structures within the eec and of theoretical interest as a point of contact between optimal tax theory and models of non price competition the roles of the two taxes as purely corrective devices under a variety of market forms are established and discussed the analysis suggests that heavily taxed commodities should normally be subject to high specific rather than high ad valorem taxes

non monotonic effects of market concentration on prices for residential solar photovoltaics in the united states abstract emerging renewable energy markets may become more concentrated over time as the most efficient firms accumulate market share the effects of this market concentration on prices are tested using a rich dataset of residential solar photovoltaic pv systems in the united states a novel hypothesis is explored that the effects of market concentration may be non monotonic prices may decline in market concentration due to efficiency gains associated with returns to scale but increase in concentration in already concentrated markets due to increasing market power the results of an econometric model provide evidence to support the non monotonic hypothesis however the data suggest that the relationship between prices and firm scale is nuanced and that both large and small scale pv installers may wield efficiency advantages

can entry or exit event studies inform horizontal merger analysis evidence from grocery retailing this study estimates how prices change following the entry and exit of grocery retailers we estimate the effects of entry exit by comparing affected markets to a set of unaffected markets using both a difference in difference estimator and a synthetic control estimator we find that entry typically results in reduced prices more surprisingly we find that exit is frequently associated with falling prices our estimated effects of entry on grocery prices are similar in magnitude to estimates of merger price effects in the supermarket industry this finding suggests that entry event studies may be a useful tool for horizontal merger analysis jel l11 l4 l81

matching models and labour market flows abstract this paper focusses on the matching approach to labour market flows it briefly reviews the facts on gross worker flows for the uk it then considers an alternative to the standard matching model which allows for job search by the employed this significantly affects the nature of aggregate unemployment dynamics over the cycle finally we consider the implications of the model for aggregate labour market dynamics

the effects of taxation price control and government contracts in oligopoly and monopolistic competition abstract many government contracts with or policies towards oligopolistic sectors essentially involve private firms selling a given proportion or quantity of output to the government at a fixed price p r with the remainder being sold on the open market often this is combined with consumer rationing examples include cement and sugar in india and health housing and defence in many countries the paper investigates the effects of these schemes including sales and excise taxation on prices output and household welfare under oligopoly and monopolistic competition less government control reduced may raise prices and tax shifting can be above or below 100 percent

entry exit and performance in airline markets abstract data from the airline industry indicate that 1 entry generally is not induced by price levels substantially above the norm 2 entry reduces fares and increases output and exit increases fares and reduces output and 3 incumbents cut price and maintain output in response to entry and survivors increase both price and output in response to exit these findings cast doubt on the ability of entry to prevent or reverse price increases from anticompetitive mergers

local employer competition and training of workers abstractthe new training literature suggests that in a monopsonistic market employers will not only pay for firm specific training but also pay for general training if the risk of poaching is limited this implies that training should decrease with more competition for employees among firms using worker level data for germany on training participation and on training duration the authors find empirical support for this hypothesis specifically the authors find that employees are significantly less likely to participate in training if the local density of firms in a sector is high and they have shorter training durations when the local sector concentration is low

competitive outcomes in product differentiated oligopoly structure firms anticipate the competitive effects of market structure when making their entry and product type decisions the market structure variables used to explain the observed outcomes therefore derive from the related entry and product choice stage of the game as a result it is crucial to allow for correlation between unobserved factors that affect the entry and product type decisions of firms and unobservables in the outcome regressions to correct for the potential bias caused by this correlation an econometric model of equilibrium market structure is employed as a selection equation in a two step estimation procedure the second step outcome regressions are modified to reflect the market structure selection this alternative approach emphasizes the logical relationship among firms entry and product choice behavior market structure and price competition following this introduction i provide some background for the analysis of competitive outcomes in motel oligopolies section iii presents the two step estimation procedure developed to measure the effects of concentration and differentiation on outcomes this procedure is used to analyze the observed outcomes of motels located along interstate highways the data are outlined in section iv in section v i present the estimation results evidence from the analysis of these outcomes help demonstrate why motel firms find differentiation a profitable product choice strategy section vi provides some concluding remarks

oil industry consolidation and refined product prices evidence from us wholesale gasoline terminals abstract our objective in this paper is to quantify the impact of petroleum industry consolidation on refined product prices controlling for other important factors that could also impact prices our empirical analysis focuses on the us petroleum refining industry using data on industry consolidation and wholesale gasoline prices collected over the interval 2000 2008 we match refinery units to wholesale city terminal gasoline markets and then estimate pooled cross section time series regressions to quantify the impact of petroleum industry consolidation on wholesale gasoline prices at city specific terminals the results of the empirical analysis of mergers are mixed showing that some petroleum industry mergers resulted in statistically significant increases in refined product prices others resulted in statistically significant declines and still others had no statistical impact at all our analysis of the effects of measures of market concentration one at the level of city specific wholesale terminals and another at the level of regional spot markets found evidence that less concentrated markets are associated with lower price levels

empirical studies of gasoline retailing a guide to the literature abstract this paper surveys the empirical literature on gasoline retailing which has been growing rapidly over the last three decades possibly in response to antitrust and regulatory concerns and increased availability of pricing data studies of both pricing and non price decision variables are considered in general it is found that crude oil prices are the primary driver of national price movements over time however market structure has been identified as playing a role in price dynamics equilibrium selection and price differentials across markets and stations the economic literature emphasizes the importance of heterogeneity across stations and coordination problems faced by retailers several directions for future work are suggested including the development of theory and demand estimation using high frequency station level data

job creation and job destruction in great britain in the 1980s using data from the workplace industrial relations surveys of 1980 1984 and 1990 the authors investigate processes of job creation and job destruction in britain they find that rates of employment growth job creation and job destruction were higher at the end of the 1980s than at the beginning bothjob creation and job destruction were extremely concentrated about 50 of each was accounted for by just 4 of continuing establishments employment growth was apparently more variable in manufacturing plants than in private service sector workplaces some variables negatively related to employment growth were unionization establishment size establishment age and location in the private manufacturing sector versus private service sector

tax incidence in differentiated product oligopoly abstract we analyze the incidence of ad valorem and unit excise taxes in an oligopolistic industry with differentiated products and price setting bertrand firms both taxes may be passed on to consumers by more than 100 percent and an increase in the tax rate can increase short run firm profits and hence the long run number of firms we provide summary conditions for these effects to arise the conditions depend on demand curvatures and are written in elasticity form surprisingly the analysis largely corroborates cournot results with homogeneous demand

testing hypotheses about firm behavior in the cigarette industry data on the effects of excise taxes are used to investigate the level of competition in the cigarette industry a lower bound on the numbers equivalent of firms in the context of the conjectural variations model is derived and estimated results point to at least a moderately high level of competition and in particular allow for the rejection of the perfect cartel model this paper relies on comparative statics results and hence circumvents recent criticisms of a study of monopoly behavior in the cigarette industry

prices and endogenous market structure in office supply superstores we consider the relationship between prices and market structure for office supply superstores in the u s which was central to the federal trade commission s opposition to the merger of staples and office depot due to potential biases in a standard regression we employ a two stage approach in which a model of endogenous market structure provides correction terms for a second stage price regression using a cross section of data on market structures and staples prices we find that excluding the correction term substantially distorts the importance of competitors as the two stage model yields stronger negative relationships between prices and market structure variables

motor fuel taxes and household welfare an applied general equilibrium analysis the shifts in expenditure patterns of motor fuel tax receipts that have occurred over the last decade typically are not included in the incidence estimates of these taxes we explicitly incorporate these changing expenditure patterns into our analysis of distributional impacts of motor fuel tax increases using an applied general equilibrium framework our results indicate that the greater the proportion of motor fuel tax revenue devoted to general uses the greater is the absolute and relative burden of the lowest income household and the more regressive is the policy with respect to the overall distributional structure

measurement of monopoly behavior an application to the cigarette industry a simple scheme is proposed to measure monopoly pricing behavior the coefficient of the tax rate term in a price equation identifies the ratio of price to marginal cost no direct measurement of costs is required so a major problem for other empirical studies of monopoly is avoided empirical results for cross section time series data support rejection of atomistic competition but also provide evidence against the operation of an effective cartel in the cigarette industry the model represents an alternative interpretation of related results in a recent paper by barzel application of the methodology to other markets is feasible

causes and consequences of layoffs using probit analysis this article finds that differential treatment accounts for a substantial portion of the higher layoff rates of blacks in comparison to whites however women are found to be considerably less prone to layoffs than men with similar characteristics among those who obtained subsequent employment taking into account the possible selectivity bias in such a subsample white males are hurt more by layoffs than black males in terms of both short term and long term earnings growth women s earnings are not necessarily affected by layoff at all however whites and males are found to be more likely to be reemployed than blacks and females respectively

shell shocked the impact of foreign entry on the gasoline retail market in china abstract since joining the wto in 2001 restrictions on foreign entry into china s energy sector have been steadily reduced we investigate the impact of royal dutch shell s entry on the pricing behavior of three varieties of gasoline in the retail market of china using a difference in difference pairwise estimator we show that a year after entry the average absolute price differential of gasoline between two cities increased by around 1 4 before falling the following year in other words shell s entry caused prices to diverge but only for a short period of time the largest price effect was found for highly refined fuels in western cities similar results are found when we examine the effect of entry of the top four foreign retailers policy implications are discussed

are flexible taxation mechanisms effective in stabilizing fuel prices an evaluation considering wholesale fuel markets in this paper we study the incidence of specific taxes in the italian fuel markets and exploit these findings to simulate the effects of fiscal policies aimed at mitigating oil price fluctuations we estimate several reduced form specifications using as dependent variables the equilibrium wholesale prices for gasoline and motor diesel over the period 1996 2007 in particular we assess the impact on wholesale gasoline and motor diesel prices stemming from the creation of an automatic fiscal mechanism consisting of reductions in specific taxes matching the rise in oil prices our simulations suggest that flexible taxation mechanisms could not be a proper policy for stabilizing price levels in fuel markets a more effective control on prices can be obtained by focusing on the market structure of these industries where antitrust authority could play a significant role

vertical relationships and competition in retail gasoline markets empirical evidence from contract changes in southern california comment this study examines how much if any of the differences in retail gasoline prices between markets is attributable to differences in the composition of vertical contract types at gasoline stations in each market the purchase of the independent retail gasoline chain thrifty by arco provides a unique opportunity to examine the effects of changes in different vertical contract types on local retail prices this event caused sharp changes in the market share of i fully vertically integrated stations and ii independent stations differentially affecting local markets in the los angeles and san diego metropolitan areas using unique and detailed station level data this study examines how these sharp changes affected local retail prices the detailed data and the research design based on the thrifty station conversions allow for credible estimation of the effects of the market share of independent retailers and vertically integrated retailers on local market prices controlling for any omitted factors at the station level and the city level over time results for the los angeles and san diego metropolitan areas indicate that a decrease in the market share of independent stations has a significant positive impact on local retail price however a change in the market share of refiner owned and operated branded stations does not have a significant impact on local market price these results have important implications as policy makers consider the regulation of vertical contracts as a means to increase competition in gasoline markets the research design and detailed data also allow for inference on the underlying nature of retail gasoline competition

retail gasoline price dynamics and local market power using monthly data from the 48 contiguous states except nevada for the 1988 2002 period it is shown that retail gasoline prices respond faster to wholesale price increases than to equivalent wholesale price decreases moreover markets with high average retail wholesale margins experience a slower adjustment and a more asymmetric response since gasoline is the only variable input average margins in a state likely reflect the degree of retail market power this suggests that sticky prices and response asymmetries in the gasoline market are at least partially a consequence of retail market power

on the dynamics of gasoline market integration in the united states evidence from a pair wise approach abstract this paper employs a pair wise approach to examine regional integration in the us gasoline market using gasoline price data at the state level over a period of more than two decades we find strong support for the view that the law of one price holds in regional markets as more than 80 of bivariate price differentials turn out to be stationary furthermore we uncover evidence that the speed at which prices converge to the long run equilibrium depends upon the distance between states asymmetries are also present in this relationship our findings suggest that the more similar are states with respect to taxation gas stations and refining capacity the faster is the speed of adjustment towards the long run equilibrium

oil exporters disappointing diversification into resource based industry abstract resource based industry rbi proved a popular use of the oil exporting countries windfalls the feasibility studies projected sizeable resource rents which encouraged the oil exporting countries to discount risk and launch ambitious rbi strategies in fact a combination of market related parameters fell well below expectations shrinking and even eliminating potential rents this has left little margin to accommodate inefficient rbi implementation

fuel subsidies versus market power is there a countervailing second best optimum fuel subsidies distort end use prices below cost resulting in overconsumption and huge environmental cost on the other hand the mark up over cost due to the exercise of market power results in the social loss of consumer surplus we open a new line of inquiry into the potential for a market based solution from these two countervailing forces can the two offsetting distortions conceivably achieve a second best optimum relying on dynamic panel techniques and gasoline market data for 68 developing countries we uncover an excessive second best subsidy offset to market power mark up on the order of 4 5 our results indicate that the potential for policy failure strongly exceeds the potential for market failure in our model and gasoline prices across our sample may not be aligned with vigorous anti climate change policy

job tenure in britain 1975 1992 the authors examine eighteen years of a large cross section to build up a picture of job tenure in britain they look for changes in the distribution of job tenure over a turbulent period for the u k labor market the authors find some change in the mean job tenure a decrease in elapsed tenure of about 10 percent between 1975 and 1992 these are important changes but they do not support the view that the dramatic changes in the labor market technology and competition have spelled the end of jobs for life copyright 1996 by royal economic society

dynamic pricing in retail gasoline markets supergame models of tacit collusion show that supportable price cost margins increase with expected future collusive profits ceteris paribus as a result collusive margins will be larger when demand is expected to increase or marginal costs are expected to decline using panel data on sales volume and gasoline prices in 43 cities over 72 months we find behavior consistent with tacit collusion in retail gasoline markets controlling for current demand and cost current margins increase with expected next month demand and decrease with expected next month cost the results are not consistent with intertemporal l inkages due to inventory behavior or customer loyalty

explaining the spread of temporary jobs and its impact on labor turnover this article provides a simple model that explains the choice between permanent and temporary jobs this model which incorporates important features of actual employment protection legislations neglected by the economic literature so far reproduces the main stylized facts about entries into permanent and temporary jobs observed in continental european countries we find that job protection has very small effects on total employment but induces large substitution of temporary jobs for permanent jobs which significantly reduces aggregate production

structure conduct and performance a simultaneous equations investigation for the brazilian manufacturing industry the article investigated structure conduct performance scp relationships in the context of the brazilian manufacturing industry in 1996 for that purpose it considered a system with four equations pertaining concentration advertising r d and profitability that was estimated with simultaneous equation models in addition to the usual explanatory variables proxying barriers to entry and demand conditions the article considered organizational practices and incentive schemes variables the evidence indicated an important role for variables related to barriers to entry in affecting market structure an important and nonlinear effect of concentration on advertising a relevant impact of firm size on the propensity to exert r d effort and finally a significant positive impact of concentration on profitability and were similar to the previous evidence for developed countries additionally no important roles were detected for organizational practices and incentive schemes on the scp relationships

2 00 gas studying the effects of a gas tax moratorium there are surprisingly few estimates of the effects of sales taxes on retail prices especially at the firm level we consider the temporary suspension and subsequent reinstatement of the gasoline sales tax in illinois and indiana following a price spike in 2000 earlier laws set the timing of the reinstatements providing plausibly exogenous changes in the tax rates using a unique dataset of daily prices at the gas station level 70 of the tax suspension is passed on to consumers in the form of lower prices while 80 100 of the tax reinstatements are passed on to consumers some evidence suggests that these short run pass through estimates are smaller near the state borders with the tax reinstatements associated with relatively higher prices up to an hour s drive into neighboring states

a theory of quits and layoffs with efficient turnover this paper answers the efficient turnover literature s long silence regarding the quit layoff distinction treating quits as worker initiated separations and layoffs as firm initiated separations i establish that the existence of layoffs is compatible with optimizing workers and firms forming and dissolving employment matches to exploit all the gains from trade the efficient turnover approach is shown to be consistent with many empirical regularities that distinguish quits from layoffs structural implications of the model are tested on data from the psid

a note on the effect of cost changes on prices in a recent article in this journal sumner 1981 took an ingenious approach to estimating the level of monopoly power in the cigarette industry he noted that differences in marginal costs exist in the industry due to varying levels of state taxes the sales prices established will satisfy the equation p i liq l mr mc where p price and q the elasticity of demand for the product in question if elasticity is a constant observing the change in marginal cost and the change in price enables one to infer the elasticity of demand perceived by the firm elasticity could then be used as a proxy for the firm s market power this technique turns out to be of very limited applicability however because it is extremely sensitive to the functional form assumed for the demand curve consider the general problem of a firm facing constant marginal costs of c in maximizing profits the firm solves

taxes cost and demand shifters as determinants in the regional gasoline price formation process evidence from spain abstract this paper examines the pass through of regional tax changes and spot price variations to regional gasoline prices in spain it also analyzes the impact of all major cost and demand shifters that contribute to regional gasoline price formation to address these research issues a reduced form price equation using monthly time series cross sectional tscs data from january 2004 through december 2008 is estimated strong and consistent evidence of full shifting of regional tax changes to regional gasoline prices is found gasoline spot price changes are more than proportionally passed through to retail prices in addition the empirical evidence shows on the one hand that regional gasoline price differences before taxes continue to be quite narrow and on the other hand that there is still a margin for larger gasoline price differences among regions this suggest that traditional practices from the monopoly era i e relatively uniform regional gasoline prices persist after the market has been liberalized which may have been facilitated by the strong and uniform presence of the major spanish based refining companies in the retail sector over the whole country

regulatory restrictions and energy the impact of the jones act on spot gasoline prices the purpose of the present study is to estimate the effects of the jones act on spot gasoline prices although the jones act pertains to the domestic shipment of all types of goods the present study will only focus on gasoline the present study will use data obtained from the energy information administration in order to determine if the price of gasoline declined during jones act waiver periods looking at daily prices the results regarding the effects of the jones act on spot gasoline prices are mixed when using a t test the results indicated either that there was no significant difference or that prices were actually higher during the waiver periods when using a first order autoregressive model it was found that prices were lower during the 2005 waiver period but higher during the 2012 waiver given these inconclusive results it is not possible to conclude that the jones act restrictions contribute to higher gasoline prices

pricing and market concentration in oligopoly markets this paper investigates the relationship between prices and market concentration in the auto rental industry we assemble an original database that includes the number of auto rental operators and other exogenous demand and cost conditions at every commercial airport in the country the data are interesting because we observe a large variation in market structure ranging from more than 100 monopoly and duopoly markets to several competitive airports with more than eight firms in addition we collect daily rental prices in each market that are regressed against the number of operating firms and other control factors due to potential biases in treating market participants as exogenously assigned we employ a two stage estimation procedure in which an equilibrium model of endogenous market structure provides correction terms for the second stage price regression results show that ignoring the endogeneity of market structure severely underestimates the impact of additional competitors on prices with the

are all the good men married uncovering the sources of the marital wage premium a longstanding and yet unsettled question in labor economics is does marriage cause men s wages to rise cross sectional wage studies consistently find that married men earn significantly higher wages than do men who are not currently married however it is well known that inferring causal relationships from crosssectional analysis is inappropriate because of the biases introduced by unobserved heterogeneity as a means of circumventing this problem this paper uses data on identical twins to control for unobserved heterogeneity our estimates suggest that marriage increases men s wages by as much as 27 and that little if any of the cross sectional relationship between marriage and wages is due to selection in addition we find little evidence that the marital wage premium is a consequence of household specialization

measuring the business stealing cannibalization and market expansion effects of entry in the u s motion picture exhibition market using a large and comprehensive theater level database covering over 18 billion in theater revenues over a five year period i document the extent and nature of business stealing revenue cannibalization and market expansion that occurred during the height of the 1990 s boom in movie theater construction

the impact of fuel tourism on retailers diesel price in spanish neighbouring regions since 1986 car fuel consumption in spain has been subject to the special hydrocarbons tax and the value added tax in addition since 2002 regional governments have been able to apply a regional excise duty on hydrocarbons this article analyses the impact that such a regional tax has on the retailer s diesel price at the border of the province of lugo in the region of galicia and the province of leon in the region of castile leon only the former region has the regional tax evidence shows that variations in the price of diesel at the border of lugo are of the same sign but of lower intensity than at the border of leon the price price elasticity is 0 8060 these results suggest that service stations located in regions with higher excise duties use their price policy to lessen the negative effects generated for fuel tourism

market structure and price cost margins in a paper that has become a standard reference in the structure conductperformance approach to industrial economics cowling and waterson 1976 developed a theoretical rationale for expecting industry profitability to be positively correlated with the level of concentration their model based on a simple algebraic description of oligopoly behaviour has been interpreted as providing a justification for the common empirical practice of cross industry regression analysis of price cost margins in terms of concentration levels in the present paper we show that on further examination this model implies a joint determination of margins and concentration this provides some interesting comparative static results of relevance to inter industry differences in concentration levels equally however it leads to various cautionary insights concerning the meaning of price cost margin versus concentration regressions

more and cheaper haircuts after vat cut on the efficiency and incidence of service sector consumption taxes abstract consumption tax rates targeted at specific sectors are often reformed without any empirical knowledge about the efficiency of these policies this paper sheds light on tax incidence as well as the efficiency issue the potential for welfare improving reform by studying the impact of value added taxes vat on prices and quantities of labor intensive services i utilize a vat reform targeted at a specific service sector which creates a natural experiment set up the vat for hairdressing services in finland was reduced from 22 to 8 and the previous tax treatment still applied to other labor intensive services the choice of the treatment and control groups was exogenous to circumstances in finland since these groups were selected from a wider european setting the results suggest that hairdressers cut their prices only by half of what a complete pass through would have implied and that there was hardly any adjustment in equilibrium quantity due to the reform hairdressers were able to increase their profits significantly there is important heterogeneity in the results according to firm size

serial correlation and the fixed effects model this paper generalizes the durbin watson type statistics to test the ols residuals from the fixed effects model for serial independence also generalized are the tests proposed by sargan and bhargava for the hypothesis that the residuals form a random walk a method for efficient estimation of the parameters is also developed finally an earnings function is estimated using the michigan survey of income dynamics in order to illustrate the uses of the tests and the estimation procedures developed in this paper

estimation of a model of entry in the airline industry this paper considers the effect of an airline s scale of operation at an airport on the profitability of routes flown out of that airport the empirical methodology uses the entry decisions of airlines as indicators of underlying profitability the results extend the empirical literature on airport presence by providing a new set of estimates of the determinants of city pair profitability these estimates imply that city pair profits increase in airport presence and decrease rapidly in the number of entering firms the literature on empirical models of oligopoly entry is also extended via a focus on the role of differences between firms

real wage cyclicality of job stayers within company job movers and between company job movers using the british new earnings survey panel data nespd for the period 1975 to 2001 we estimate the wage cyclicality of job stayers those remaining within single jobs in a given company within company job movers and between company job movers we also examine how the proportion of internal and external job moves varies over the business cycle we find that the wages of internal movers are slightly more procyclical and wages of external movers considerably more procyclical than those of stayers notwithstanding a decomposition shows that in britain wage cyclicality arises almost entirely from the procyclicality of wages for job stayers with across and within firm mobility playing a lesser role thus there is little evidence for rigid wage models that imply that employers use changes in job titles as a means of adjusting wages to the business cycle we also show that the distinctions between private and public sectors and between workers covered and uncovered by collective agreements have important impacts on the wage estimates of both stayers and movers

competition and price discrimination evidence from the parking garage industry we study the relationship between competition and price discrimination through an empirical examination of hourly price schedules in the parking garage industry we find that the degree of price schedule curvature decreases with competition implying a greater proportionate drop in low end prices than in high end prices when competition intensifies our findings suggest that competition constrains a firm s capacity to exercise price discrimination confirming the classic textbook theory we also offer possible explanations for our findings including a search cost explanation for which we find some support in the data

paying a premium on your premium consolidation in the us health insurance industry we examine whether and to what extent consolidation in the u s health insurance industry is leading to higher employer sponsored insurance premiums we make use of a proprietary panel dataset of employer sponsored healthplans enrolling over 10 million americans annually between 1998 and 2006 to explore the relationship between premium growth and changes in market concentration we exploit the differential impact of a large national merger of two insurance firms across local markets to estimate the causal effect of concentration on market level premiums we estimate real premiums increased by approximately 7 percentage points in a typical market due to the rise in concentration during our study period we also find evidence that consolidation facilitates the exercise of monopsonistic power vis a vis physicians whose absolute employment and relative earnings decline in its wake

the competitive impact of hypermarket retailers on gasoline prices abstracthypermarkets are large retail suppliers of general merchandise or grocery items that also sell gasoline often at very low margins this paper estimates the impact of hypermarkets on average state level retail gasoline prices and margins the empirical results indicate an economically and statistically significant price decreasing effect of increased hypermarket competition the estimations also suggest that refiners lower the delivered wholesale prices charged to their affiliated lessee dealer and open dealer stations in response to increased hypermarket competition which in turn translates to lower retail street prices the adoption of sales below cost laws may lessen the price reducing effects from hypermarket competition

promotion signaling gender and turnover new theory and evidence we extend promotion signaling theory to incorporate gender and across firm mobility within and across job levels evidence from worker firm linked finnish panel data supports our theory for some groups controlling for worker performance inferred from performance related pay within firm promotion probabilities are increasing and wage increases from promotion are decreasing in educational attainment for some educational groups with results stronger for first than for subsequent promotions women have lower promotion probabilities than men and a greater sensitivity of promotion probability to educational attainment across firm promotions are rare but bring wage increases exceeding those for internal promotions and across firm lateral moves

the importance of lifetime jobs in the u s economy though the u s labor market is justly notorious for high turnover and consequent high unemployment it also provides stable near lifetime employment to an important fraction of the labor force this paper investigates patterns of job duration by age race and sex with the following major conclusions 1 the typical worker today is holding a job which has lasted or will last about eight years over a quarter of all workers are holding jobs which will last twenty years or more sixty percent hold jobs which will last five years or more 2 the jobs held by middle aged workers with more than ten years of tenure are extremely stable over the span of a decade only twenty to thirty percent come to an end 3 among workers aged thirty and above about forty percent are currently working in jobs which eventually will last twenty years or more three quarters are in jobs which will last five years or more 4 the duration of employment among blacks is just as long as among whites even though the jobs held by blacks are worse in almost every other dimension they are no more unstable than those held by whites 5 women s jobs are substantially shorter than men s on the average only about a quarter of all women over the age of thirty are employed in jobs which will last over twenty years whereas over half of men over thirty are holding these near lifetime jobs this abstract was borrowed from another version of this item

who pays cigarette taxes the impact of consumer price search abstract we conduct an empirical study of the impact of consumer price search on the shifting of cigarette excise taxes to consumer prices we use novel data on the prices that smokers report paying and document substantial price dispersion we find that cigarette taxes are shifted at lower rates to carton buyers and especially smokers who buy cartons of cigarettes in a state other than their state of residence we also find evidence that taxes are shifted at somewhat lower rates to the prices paid by heavier smokers and at somewhat higher rates to the prices paid by smokers of light cigarettes

a short history of labour turnover job tenure and job security 1975 93 how extensive is labour turnover and how does it vary by gender skill and over time using survey data from britain between 1975 and 1993 this study documents these features and discovers evidence of widening inequalities in job stability and security for the majority still in full time employment average job durations are little changed from those of twenty years ago for those seeking employment however current patterns of job creation mean that entry jobs are now of shorter duration more unstable and relatively less well paid nor do entry jobs offer sufficient access into stable jobs as a result entry jobs are increasingly taken by those with a partner in work polarising the distribution of employment and thereby disenfranchising around one fifth of working age households from regular access to earned incomes copyright 1995 by oxford university press

nigeria during and after the oil boom a policy comparison with indonesia nigeria and indonesia provide an interesting contrast with regard to performance and policy during and after the oil boom roughly a decade after the first oil shock nigeria is faced with several economic problems including a serious decline in its agricultural sector and a deteriorating external debt situation while some decline in the nonoil traded goods sector reflects efficient adjustment to the oil boom policy with regard to public expenditure exchange rates pricing and the trade regime could exacerbate such decline and impede readjustment as the boom subsides the links between oil prices deficits inflation and real exchange rate appreciation are analyzed and nigerian and indonesian fiscal and exchange rate and agricultural and foreign borrowing strategies are compared it is concluded that with the exception of cuts in the deficit since 1984 nigerian policy following the boom has not been conducive to adjustment to the current period of low oil prices and high real interest rates corrective measures and policy options are discussed

clean air regulation and heterogeneity in us gasoline prices in order to improve public health in areas with air quality problems the us clean air act imposes a variety of federal regulations on gasoline which have led to a proliferation of fuel blends known as boutique fuels more than 45 fuel blends are sold nationwide we examine the effects of this program on wholesale gasoline prices the methodological innovation in this study is the use of a regulatory distance measure as a proxy for measuring market power that arises from product differentiation we find that clean air regulation increases gasoline prices by increasing the cost of refining but more importantly by creating regulatory islands it segments the market and increases the market power of firms our estimation controls for the potential endogeneity of the regulatory variables we find that ols techniques systematically underestimate the effect of regulation on gasoline prices

fuel tax incidence and supply conditions abstract the incidence of taxes on consumers and producers plays a central role in evaluating energy tax policy yet the literature testing the main predictions of the tax incidence model is sparse in this paper we examine the pass through rate of state gasoline and diesel taxes to retail prices and importantly we estimate the dependence of pass through on factors constraining the gasoline and diesel supply chains we consider several factors that alter the elasticity of supply including within state heterogeneity in gasoline content requirements refinery capacity utilization inventory constraints and variation in the demand for untaxed uses of diesel in general we find that in periods of time when the supply chain is constrained and the constraint is plausibly unrelated to shifts in demand the pass through rate of fuel taxes declines we describe several potential implications for tax policy including tax breaks during peak driving season and during times of supply disruptions such as after major hurricanes

the causes and consequences of wal mart s growth wal mart is the largest company in the world yet little is known about its economic impact this essay discusses what is known about wal mart s competitive advantage and its economic impact on local communities as well as the national and global economy and highlights the open questions to be addressed by future research

do gasoline mergers affect consumer prices the marathon ashland petroleum and ultramar diamond shamrock transaction abstract in 1999 marathon ashland petroleum map acquired the michigan assets of ultramar diamond shamrock uds which increased map s share of terminal storage in michigan from about 16 percent to about 25 percent and increased the share of gasoline stations bearing a map brand from about 16 percent to about 24 percent in this paper we examine whether this acquisition affected the retail price of gasoline we use a difference in differences model to compare price movements in six michigan cities affected by the acquisition with price movements in two nearby cities unaffected by the acquisition using this model we find no evidence that this acquisition led to higher prices for consumers

oil windfalls in a small parliamentary democracy their impact on trinidad and tobago in common with other oil exporters trinidad and tobago reaped large windfall gains after 1973 their use was heavily influenced by its distinctive political economy and resulted in substantial weakening of its non oil traded sectors the dutch disease attempts to diversify through gas based industrialization are not likely to replace shrinking oil income this paper traces the relationship from political objectives to use of oil windfalls and the effects on the non oil economy

pass through of motor gasoline taxes efficiency and efficacy of environmental taxes abstract to investigate the efficacy and efficiency of environmental taxes i analyze the rate at which taxes on motor gasoline are passed to consumers by estimating two cointegrating vector autoregression models for each of six states for state models that specify the retail price of motor gasoline without taxes exclusion tests suggest that taxes on motor gasoline are not passed to consumers on a one for one basis for state models that specify the retail price of motor gasoline including taxes results indicate that taxes are passed to wholesale prices in florida and massachusetts on a one for one basis and are passed to retail prices with a mark up in florida massachusetts new york and ohio and are not fully passed through in washington state specific rates of pass through differ from results suggested by theory and fixed effects estimators which may be biased by the presence of nonstationary data and the assumption that the rate of pass through is the same across states rates of pass through greater than one transfer 12 2 billion from consumers to retailers in fl 2 3 billion in ma and 19 2 billion in ny during the sample period which represent 10 7 6 0 and 23 9 of total expenditures on regular motor gasoline

job tenure and job mobility in britain using work history data from the british household panel survey the authors examine job mobility and job tenure over the period 1915 90 british men and women held an average of five jobs over the course of their work lives and half of all lifetime job changes occurred in the first ten years separation hazards were higher for more recent cohorts implying an increase in job instability as jobs accumulated average tenure lengthened but the proportion of involuntary separations increased for both men and women the rise in job instability was particularly marked in the lowest occupational classification in general job insecurity was greater for men than women

perfect competition urbanization and tax incidence in the retail gasoline market i introduction in applied tax incidence studies it is typically assumed that prices respond one for one to changes in sales and excise taxes chernick and reschovsky 1997 pechman 1985 shepard 1976 state of wisconsin department of revenue 2004 wiese rose and schluter 1995 zupnick 1975 is this assumption reasonable despite the fundamental role of tax incidence in the study of public finance there is surprisingly little empirical analysis that sheds light on who bears the burden of taxes in this article we examine the incidence of state gasoline excise taxes using monthly price data for all 50 states in the united states over the period 1984 1999 our estimation results generally indicate full shifting of gasoline taxes to the final consumer with changes in gasoline taxes fully reflected in the tax inclusive gasoline price almost instantly we also find that the incidence of excise taxes depends on the competitiveness of retail gasoline markets e g urban vs rural markets gasoline markets in urban states typically exhibit full shifting but those in rural states demonstrate somewhat less than full shifting although the issue of sales and excise tax incidence has received considerable attention over the years most research has focused on tax incidence theory and the standard conclusion of much of this theoretical analysis is that consumers bear the full burden of any sales and excise taxes 1 based primarily on this theoretical foundation most applied incidence studies assume that sales and excise taxes are fully reflected in consumer prices and the distribution of tax burdens across income classes necessarily reflects this assumption however actual empirical testing of this assumption of full forward shifting has been surprisingly sparse 2 in important recent research poterba 1996 and besley and rosen 1999 have conducted empirical analyses of the incidence of excise taxes poterba 1996 uses city specific clothing and personal care price data covering the 1947 1977 and the 1925 1939 periods to examine the degree to which state and local retail sales taxes are shifted to consumers with two data sets based on bureau of labor statistics bls city specific consumer price indices using these bls data on tax inclusive prices poterba 1996 constructs quarterly price indices for each of 28 standard metropolitan statistical areas smsas many of these 28 smsas experienced significant changes in sales tax rates and poterba 1996 uses these tax shocks to determine the incidence of sales taxes his estimation results are somewhat variable but in general he finds for the postwar period that taxes are fully shifted to consumers in some cases he finds limited evidence of overshifting although it is never possible to reject the null hypothesis that prices rise point for point with the changes in the tax and he also finds that full shifting typically though not always occurs in the first quarter of the tax change poterba 1996 also examines tax incidence for individual smsas during the depression era and his results indicate significant differences across metropolitan areas in the degree of tax shifting for example prices on women s clothing in chicago show significant overshifting but atlanta shows negative shifting a result that does not seem plausible besley and rosen 1999 also examine the incidence of sales taxes using price data for 12 narrowly defined commodities in 155 different u s cities using quarterly price data for the period 1982 1990 issued by the american chamber of commerce researchers association accra 3 they not only find full shifting for a number of commodities but also find overshifting for more than half the products a result they attribute to imperfect competition in the retail sector while this recent empirical research has significantly expanded our understanding of the actual nature of sales and excise tax incidence we believe that our work here on gasoline excise taxes makes several contributions to the empirical literature

adjustment with a fixed exchange rate cameroon cote d ivoire and senegal as members of the cfa franc zone cameroom cote d ivoire and senegal cannot use the nominal exchange rate as a tool of macroeconomic adjustment this article considers these countries responses to the commodity and oil price shocks of the 1970s in light of this and other institutional constraints using a two sector model it shows that there exist instruments that in principle permit the real exchange rate depreciation necessary for adjusting to macroeconomic imbalances the authors interpret the very different adjustment experiences of the three countries despite their common economic structure and institutional setting in terms of different uses of these instruments alternative assumptions about the labour market leave the qualitative nature of the results unaltered statistical analysis of data from the three countries confirms the model s linking of the current account and real exchange rate with the instruments of adjustment

the effects of market structure on prices of clothing and household furnishings abstract in this paper prices of clothing and household furnishings are explained using commuting variables and market concentration of department stores the concentration variable has a strong effect on prices of both product types the commuting variables only affect furnishings prices a result that is in keeping with expectations

job stability in the united states two key attributes of a job are its wage and its duration much has been made of changes in the wage distribution in the 1980s but little attention has been given to job durations since hall we fill this void by examining the temporal evolution of job retention rates in u s labor markets using data assembled from the sequence of current population survey job tenure supplements there have been relative declines in job stability for some of the groups that experienced the sharpest declines in relative wages however we find that aggregate job retention rates have remained stable

endogeneity in the concentration price relationship causes consequences and curses the ordinary least squares estimator of the effect of concentration on price is biased for two reasons first performance feeds back into structure causing a simultaneous equations bias second as a function of outputs or revenues measured concentration is correlated with determinants of price that are at best measured with error so measured concentration is correlated with the error term with panel data fixed effects procedures can be combined with instrumental variables to eliminate bias from both sources in concentration price regressions for the airline industry the bias can be substantial and negative copyright 1993 by blackwell publishing ltd

do gasoline prices respond asymmetrically to crude oil price changes the authors test and confirm that retail gasoline prices respond more quickly to increases than to decreases in crude oil prices among the possible sources of this asymmetry are production inventory adjustment lags and market power of some sellers by analyzing price transmission at different points in the distribution chain the authors attempt to shed light on these theories spot prices for generic gasoline show asymmetry in responding to crude oil price changes which may reflect inventory adjustment effects asymmetry also appears in the response of retail prices to wholesale price changes possibly indicating short run market power among retailers

the internal determinants of eight oil exporting countries resource based industry performance the performance of the oil exporters resource based industry rbi was determined by sectoral mix type of enterprise and macroeconomic policy rbi strategies tended to be overambitious and overdependent on one sector especially in the bigger countries wholly state owned enterprises soes experienced more problems than joint ventures macroeconomic mismanagement shrank domestic markets and denied competitive exchange rates for viable exports the dismal nigerian and venezuelan rbi performances reflect weak macroeconomic policy and the dominance of soe steel results are better in the soundly managed asian economies which also benefited from greater use of joint ventures with multinational corporations the anomaly of saudi arabia s initial under performance reflects strategy flaws