Assimetria na Transmissão de Preços e Poder de Mercado: o caso do mercado varejista de etanol no estado de São Paulo

The presence of market power in fuel retailing has been a major concern in Brazil, motivating antitrust investigations as well as economic research. However, lack of appropriate data precludes the estimation of straight market power indicators, leaving the possibility of using price series to identify market power. The objective of this study is to identify the presence of market power at the retail of fuel ethanol in cities of different sizes. The method adopted consists in verifying if price increases and decreases are transmitted asymmetrically to consumers, assuming that more intense transmission of price increases is related to the presence of market power. Monthly wholesale and retail price series of ethanol for cities with different sizes located in São Paulo State, Brazil, were used. The results indicate the presence of market power, since retailers were able to transmit price increases more rapidly and more intensively than price decreases for most cities. Such results suggest that asymmetry in price transmission can be a useful analytical tool to investigate market power and that antitrust authorities must observe the retail concentration and the behavior in the fuel market in order to protect consumers.

Issue Date:
Jun 30 2015
Publication Type:
Journal Article
PURL Identifier:
Published in:
Brazilian Journal of Rural Economy and Sociology (Revista de Economia e Sociologia Rural-RESR), Volume 53, Number 2
Page range:
Total Pages:
JEL Codes:
L1; D4; C5.
Series Statement:
Volume 53
Number 02

 Record created 2017-04-01, last modified 2017-08-28

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