Gasoline Price Cycles Under Discrete Time Pricing

Nicolas De Roos, Hajime Katayama

研究成果: Article査読

14 被引用数 (Scopus)

抄録

We characterise petrol pricing dynamics in an unusual policy environment. A timing restriction in the Western Australian market imposes discrete time pricing on petrol retailers, enabling us to observe the exact timing of price changes. We employ a Markov-switching regression model, finding the existence of Edgeworth price cycles of a similar nature to those recently observed in some other retail petrol markets. Cycles are frequent, asymmetric and of substantial amplitude. Importantly, firms change prices almost every period, limiting the relevance of the leading theory of Edgeworth cycles due to Maskin and Tirole (). We also discuss episodes of disruption and evolution of the price cycle.

本文言語English
ページ(範囲)175-193
ページ数19
ジャーナルEconomic Record
89
285
DOI
出版ステータスPublished - 2013 6 1

ASJC Scopus subject areas

  • Economics and Econometrics

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