Detailed Data and Changes in Market Structure: The Move to Unmanned Gasoline Service Stations

Tinbergen Institute Discussion Paper 14-123/VII

43 Pages Posted: 17 Sep 2014

See all articles by Tadas Bruzikas

Tadas Bruzikas

University of Groningen

Adriaan R. Soetevent

University of Groningen

Date Written: September 16, 2014

Abstract

We illustrate the impact of detailed data in empirical economic research by considering how the increased data availability has changed the scope and focus of studies on retail gasoline pricing. We show how high-volume, high-frequency price data help to identify and explain long-term trends using original data for the Dutch retail gasoline market.

We find that 22% of the observed increase in the highway/off-highway price gap can be explained by the trend towards more unmanned stations; another 13% can be explained by major-to-non-major re-brandings. In one of the first applications of event study analysis to non-financial price data, we show that the adjustment to the new, lower price level is almost immediate in case of manned-to-unmanned conversions but takes one to two months in case of major-to-non-major re-brandings. The impact of both events is asymmetric with no measurable price impact of changes in the opposite direction.

Keywords: retail gasoline pricing, big data, competitive spillovers, event study analysis

JEL Classification: L01, L13, L81

Suggested Citation

Bružikas, Tadas and Soetevent, Adriaan R., Detailed Data and Changes in Market Structure: The Move to Unmanned Gasoline Service Stations (September 16, 2014). Tinbergen Institute Discussion Paper 14-123/VII, Available at SSRN: https://ssrn.com/abstract=2496954 or http://dx.doi.org/10.2139/ssrn.2496954

Tadas Bružikas (Contact Author)

University of Groningen ( email )

P.O. Box 800
9700 AH Groningen, Groningen 9700 AV
Netherlands

HOME PAGE: http://sites.google.com/site/tadasbruzikas/

Adriaan R. Soetevent

University of Groningen ( email )

P.O. Box 800
9700 AV Groningen
Netherlands
++ 31 50 363 7018 (Phone)

HOME PAGE: http://www.soetevent.com

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