Flex Cars and Competition in Fuel Retail Markets
We study how the diffusion of flex (bi-fuel) cars affected competition on ethanol and gasoline retail markets. We propose a model of price competition in which the two fuels become closer substitutes as flex cars penetration grows. We use a large panel of weekly prices at the station level to show that fuel prices and margins have fallen in response to this change. This finding is evidence of market power in fuel retail and indicates that innovations that increase consumer choice benefit even those who choose not to adopt them.
International Journal of Industrial Organization V 36, P 145-184, 2019
Leonardo Rezende, Juliano Assunção, João Paulo Cordeiro De Noronha Pessoa.
Publications
-
Não apague isso
EconomiA
2050 -
Daniel Adib, João Ayres, Silvia Matos, Marco Bonomo, Carlos Viana de Carvalho, Stefano Eusepi, Marina Perrupato Mendonça.
Abrupt Monetary Policy Change and Unanchoring of Inflation Expectations (a sair)
Journal of Monetary Economics
2024 -
Larry Ball, Chris Evans, Luca Ricci, Carlos Viana de Carvalho.
Weighted Median Inflation Around the World: A Measure of Core Inflation
Journal of International Money and Finance
2024