Market power in distribution and pass‐through for consumers and producers

Francois, Joseph; Manchin, Miriam (2018). Market power in distribution and pass‐through for consumers and producers. Review of International Economics, 27(1), pp. 290-312. Wiley 10.1111/roie.12376

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We examine the differential pass‐through of import prices into consumer and producer prices. We develop a framework with distribution costs and distribution market power. We then examine pass‐through from import prices to consumer and producer prices in the euro area using the U.S. import price as instrument. We find that pass‐through rates to producer prices are more sensitive to changes in distribution margins than pass‐through to consumer prices. Furthermore, only a portion of import price changes translate into domestic price changes limiting potential consumer benefits from tariff liberalization, with market power in distribution services being one important factor reducing pass‐through.

Item Type:

Journal Article (Original Article)

Division/Institute:

02 Faculty of Law > Department of Economic Law > World Trade Institute
10 Strategic Research Centers > World Trade Institute

03 Faculty of Business, Economics and Social Sciences > Other Institutions > Teaching Staff, Faculty of Business, Economics and Social Sciences
02 Faculty of Law > Department of Economic Law > NCCR International Trade Regulation

UniBE Contributor:

Francois, Joseph and Manchin, Mirjam Judit

Subjects:

300 Social sciences, sociology & anthropology > 380 Commerce, communications & transportation
300 Social sciences, sociology & anthropology > 340 Law

ISSN:

1467-9396

Publisher:

Wiley

Language:

English

Submitter:

Rebecca Anne Gilgen

Date Deposited:

13 Feb 2019 15:09

Last Modified:

04 Nov 2019 21:38

Publisher DOI:

10.1111/roie.12376

BORIS DOI:

10.7892/boris.126112

URI:

https://boris.unibe.ch/id/eprint/126112

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