sábado, 13 de agosto de 2005

Continuando con el Oligopolio: un ejemplo.

A propósito del post anterior "Indecopi y el problema de la posición dominante conjunta", a continuación exponemos un ejemplo extraído de una Circular de la División Antitrust del Departamento de Justicia de EEUU. Esta circular se encuentra incluida dentro de "Oligopoly" OCDE:1999. 291p.

A simple illustration

· Two gas stations (A and B) sell across the road from each other along an isolated stretch of highway. Currently, both stations charge $1 / gallon. The two stations are regarded by consumers as offering identical products. With each station pricing at $1, each expects to receive 50 percent of the business.

· Station A contemplates raising its price to $1.25 / gallon. The price hike would be profitable to A only if B matches the price, since otherwise all consumers will desert A in favor of B.

· At first glance, it appears risky for A to proceed with the price hike without some prior assurance (i.e., an explicit price-fixing agreement) that B will follow, since if the price hike is not matched, A will lose all the business.

· Suppose that A proceeds with the price hike anyway. If A raises its price, it will learn quickly whether B has followed -- either by observing the signs that communicate B’s price to drivers, or by whether it experiences a sharp drop in sales (indicating that B has not matched). If B has not followed the increase, A can promptly restore its $1 price and suffer only a very transitory loss of business.

· Hence, A faces relatively little risk by initiating the price increase.

· Consider now Station B’s options. If B decides not to match A’s price hike, B could enjoy a period when it captures 100 percent of the sales. As explained above, A will quickly learn about B’s decision and will retract the price hike. B’s profit gains will thus be brief. Alternatively, if B chooses to match A’s increase, it would forego the brief period of extra business in return for a long-run equilibrium in which it shares the market with A at the higher price $1.25.

· Unless B strongly discounts future profits, it has a unilateral incentive to match the price increase by A.

· Since A now expects that B will find it in its self-interest to follow, A can initiate the price increase with minimal risk.

Questions

1) Are A and B tacitly colluding to price at $1.25? Or are they simply pricing in their own selfinterest, factoring in their rival duopolist’s expected best response?

2) What is it that A or B did that is objectionable?

3) How would we fashion a remedy against it?

· We can’t argue that A should have ignored the fact that, given the market environment, B would likely match A’s price hike. To argue this would be akin to requiring A to pretend that it operates in a perfectly competitive market rather than in a duopoly. I.e., to ignore the perceived interdependence between A and B. (lo resaltado es nuestro)

· Similarly, we can’t argue that B should not have matched A’s price hike, i.e., that B should have ignored the fact that if B had not matched A would simply have rescinded the hike. Again, this would be akin to asking B to pretend it operates in a perfectly competitive market.

· If we deem A and B to be colluding, what remedy would we seek? The root source of the “undesirable pricing” is the duopoly industry structure rather than firms’ behavior. The only potential remedies are a) direct price regulation or b) structural deconcentration to break apart the duopoly.

Dentro de las soluciones planteadas en del ejemplo, por lo menos la fijación de precios por parte del Estado no resulta una solución viable.

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