Abstract

http://ssrn.com/abstract=1729577
 


 



Measuring Competition Using the Profit Elasticity: American Sugar Industry, 1890-1914


Jan Boone


Tilburg University - Center for Economic Research (CentER); Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA); TILEC

Michiel Van Leuvensteijn


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December 2010

CEPR Discussion Paper No. DP8159

Abstract:     
The Profit Elasticity (PE) is a new competition measure introduced in Boone (2008). So far, there was no direct proof that this measure can identify regimes of competition empirically. This paper focuses on this issue using data of Genesove and Mullin (1998) in which different regimes of competition are identified. We derive a version of PE suitable for this data set. This competition measure correctly classifies the monopoly cartel regime as being less competitive than both the price war regime and break-up of cartel regime.

Number of Pages in PDF File: 14

Keywords: competition, measures of competition, price cost margin, profit elasticity

JEL Classification: D43, L13

working papers series


Date posted: December 27, 2010  

Suggested Citation

Boone, Jan and van Leuvensteijn, Michiel, Measuring Competition Using the Profit Elasticity: American Sugar Industry, 1890-1914 (December 2010). CEPR Discussion Paper No. DP8159. Available at SSRN: http://ssrn.com/abstract=1729577

Contact Information

Jan Boone (Contact Author)
Tilburg University - Center for Economic Research (CentER) ( email )
P.O. Box 90153
Tilburg, 5000 LE
Netherlands
+31 13 466 2399 (Phone)
+31 13 466 3042 (Fax)
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Institute for the Study of Labor (IZA)
P.O. Box 7240
Bonn, D-53072
Germany
TILEC ( email )
Warandelaan 2
Tilburg, 5000 LE
Netherlands
Michiel Van Leuvensteijn
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