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| Author: | Hoffmaister, A.W. |
| Title: | Barriers to retail competition and prices: Evidence from Spain |
| Journal: | Oxford Economic Papers
2010 : APR, VOL. 62:2, p. 395-416 |
| Index terms: | models Spain competition policy prices regional differences retailing distribution |
| Freeterms: | entry barriers |
| Language: | eng |
| Abstract: | It is questioned why prices in Spain's regions fail to converge. The prime suspects are differences in regional barriers to entry (henceforth as: b-to-e.) in retail distribution. This paper develops a Cournot-Nash model of imperfect competition to illustrate the effect of barriers on prices. Based on a unique data from an extensive analysis of competition policies in Spain, there is provided evidence that b-to-e. increase regional prices. It is also suggested that, consistent with the model's predictions, b-to-e. raise prices up to a point, thus indicating barriers having a threshold effect on prices. |
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