Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs

This paper analyses the impact of local competition on gasoline and diesel pricing at branded and unbranded independent service stations. Based on our theory-driven discussion we derive a number of hypotheses, which are empirically tested on a sample of service stations in Spain. In Spain, retail pr...

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Detalles Bibliográficos
Autores: Arocena Garro, Pablo, Bello Pintado, Alejandro, Contín Pilart, Ignacio
Tipo de recurso: artículo
Estado:Versión publicada
Fecha de publicación:2023
País:España
Institución:Universidad San Jorge (USJ)
Repositorio:Academica-e. Repositorio Institucional de la Universidad Pública de Navarra
OAI Identifier:oai:academica-e.unavarra.es:2454/46037
Acceso en línea:https://hdl.handle.net/2454/46037
Access Level:acceso abierto
Palabra clave:Diesel
Gasoline
Retail pricing
Search costs
Seller density
Unbranded stations
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spelling Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costsArocena Garro, PabloBello Pintado, AlejandroContín Pilart, IgnacioDieselGasolineRetail pricingSearch costsSeller densityUnbranded stationsThis paper analyses the impact of local competition on gasoline and diesel pricing at branded and unbranded independent service stations. Based on our theory-driven discussion we derive a number of hypotheses, which are empirically tested on a sample of service stations in Spain. In Spain, retail prices of motor fuels have been under the spotlight since the dismantling of the state monopoly in the 1990s. The concentration of the retail market and the behavior of the main oil operators are of constant concern to the competition authorities. Our empirical analysis provides evidence for the existence of different competitive dynamics between branded and unbranded stations, and between gasoline and diesel retail pricing. Specifically, the results show that (i) fuel prices at branded (unbranded) service station are positively (negatively) associated with the number of stations operating in the same local market, (ii) prices of both motor fuels at a branded station are higher the larger the share of stations carrying the same brand in its local market, (iii) diesel price at an unbranded station is lower the larger the share of unbranded stations in its local market, and (iv) unbranded service stations undercut the price of diesel more than that of gasoline compared with prices at branded stations.The authors acknowledge financial support from the Spanish Ministry of Science and Innovation, Grant PID2020-114460GB-C32 funded by MCIN/AEI/10.13039/501100011033 and Grant 2021/00064/001. Open access funding provided by Universidad Pública de Navarra.Taylor and Francis GroupGestión de EmpresasEnpresen KudeaketaInstitute for Advanced Research in Business and Economics - INARBEUniversidad Pública de Navarra / Nafarroako Unibertsitate Publikoa2023info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionapplication/pdfhttps://hdl.handle.net/2454/46037reponame:Academica-e. Repositorio Institucional de la Universidad Pública de Navarrainstname:Universidad San Jorge (USJ)Inglésinfo:eu-repo/grantAgreement/AEI/Plan Estatal de Investigación Científica y Técnica y de Innovación 2017-2020/PID2020-114460GB-C32info:eu-repo/grantAgreement/AEI//2021%2F00064%2F001© 2023 The Author(s). This is an Open Access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives License.https://creativecommons.org/licenses/by-nc-nd/4.0/info:eu-repo/semantics/openAccessoai:academica-e.unavarra.es:2454/460372026-06-17T12:41:47Z
dc.title.none.fl_str_mv Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
title Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
spellingShingle Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
Arocena Garro, Pablo
Diesel
Gasoline
Retail pricing
Search costs
Seller density
Unbranded stations
title_short Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
title_full Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
title_fullStr Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
title_full_unstemmed Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
title_sort Automotive fuel prices at branded and unbranded service stations: differences in the impact of seller density, brand concentration and search costs
dc.creator.none.fl_str_mv Arocena Garro, Pablo
Bello Pintado, Alejandro
Contín Pilart, Ignacio
author Arocena Garro, Pablo
author_facet Arocena Garro, Pablo
Bello Pintado, Alejandro
Contín Pilart, Ignacio
author_role author
author2 Bello Pintado, Alejandro
Contín Pilart, Ignacio
author2_role author
author
dc.contributor.none.fl_str_mv Gestión de Empresas
Enpresen Kudeaketa
Institute for Advanced Research in Business and Economics - INARBE
Universidad Pública de Navarra / Nafarroako Unibertsitate Publikoa
dc.subject.none.fl_str_mv Diesel
Gasoline
Retail pricing
Search costs
Seller density
Unbranded stations
topic Diesel
Gasoline
Retail pricing
Search costs
Seller density
Unbranded stations
description This paper analyses the impact of local competition on gasoline and diesel pricing at branded and unbranded independent service stations. Based on our theory-driven discussion we derive a number of hypotheses, which are empirically tested on a sample of service stations in Spain. In Spain, retail prices of motor fuels have been under the spotlight since the dismantling of the state monopoly in the 1990s. The concentration of the retail market and the behavior of the main oil operators are of constant concern to the competition authorities. Our empirical analysis provides evidence for the existence of different competitive dynamics between branded and unbranded stations, and between gasoline and diesel retail pricing. Specifically, the results show that (i) fuel prices at branded (unbranded) service station are positively (negatively) associated with the number of stations operating in the same local market, (ii) prices of both motor fuels at a branded station are higher the larger the share of stations carrying the same brand in its local market, (iii) diesel price at an unbranded station is lower the larger the share of unbranded stations in its local market, and (iv) unbranded service stations undercut the price of diesel more than that of gasoline compared with prices at branded stations.
publishDate 2023
dc.date.none.fl_str_mv 2023
dc.type.none.fl_str_mv info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
format article
status_str publishedVersion
dc.identifier.none.fl_str_mv https://hdl.handle.net/2454/46037
url https://hdl.handle.net/2454/46037
dc.language.none.fl_str_mv Inglés
language_invalid_str_mv Inglés
dc.relation.none.fl_str_mv info:eu-repo/grantAgreement/AEI/Plan Estatal de Investigación Científica y Técnica y de Innovación 2017-2020/PID2020-114460GB-C32
info:eu-repo/grantAgreement/AEI//2021%2F00064%2F001
dc.rights.none.fl_str_mv https://creativecommons.org/licenses/by-nc-nd/4.0/
info:eu-repo/semantics/openAccess
rights_invalid_str_mv https://creativecommons.org/licenses/by-nc-nd/4.0/
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Taylor and Francis Group
publisher.none.fl_str_mv Taylor and Francis Group
dc.source.none.fl_str_mv reponame:Academica-e. Repositorio Institucional de la Universidad Pública de Navarra
instname:Universidad San Jorge (USJ)
instname_str Universidad San Jorge (USJ)
reponame_str Academica-e. Repositorio Institucional de la Universidad Pública de Navarra
collection Academica-e. Repositorio Institucional de la Universidad Pública de Navarra
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repository.mail.fl_str_mv
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