Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/95975
Authors: 
Wittmann, Nadine
Year of Publication: 
2014
Series/Report no.: 
Economics Discussion Papers 2014-17
Abstract: 
In 2011, price peaks in retail gasoline prices caused public outrage and attracted the attention of German regulatory agencies. After having examined the market, competition authorities concluded that tacit collusion existed but could not easily be prosecuted under the given competition law. In several other countries, various types of regulatory schemes are implemented to tackle tacit collusive behavior. E.g. there are price ceilings established in Luxembourg or per day limits of price increases given in Austria. However, research has found that none of them has led to satisfactory results. Hence, the following paper proposes a different regulatory approach, i.e. the implementation of corrective taxes. Results show that a special type of variable tax scheme successfully manages to render collusion an unprofitable business. In addition, it is also easy to levy and monitor. Thereby, the inherent vice of the gasoline retail market, i.e. the transparency that enables tacit - and therefore non-prosecutable - collusion, could be turned into a regulatory virtue as it becomes a powerful means to help successfully tackle imperfect competition and to bring about a more efficient market outcome.
Subjects: 
gasoline retail market
regulation
market structure and antitrust
collusion
JEL: 
Q48
D42
D43
Creative Commons License: 
http://creativecommons.org/licenses/by/3.0/
Document Type: 
Working Paper

Files in This Item:
File
Size
442.95 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.