| Sammanfattning: | <p>The first chapter uses the conduct parameter approach to evaluate the sources of market power enjoyed by UK supermarkets from 1994-2006. During this period, the households rapidly shifted their purchase of fresh liquid milk from the milkmen to the supermarkets. At the same time, the supermarkets’ margin grew from negative to over 25 percent. The conduct parameter is used to investigate the sources of such market power. The analysis accounts for the change in consumers’ demand pattern, and uses direct measures of the marginal costs. My results suggest that the increase in the supermarkets’ margin was explained mainly by a significant decline in the price elasticity of demand for supermarket milk and, to a lesser extent, an increase in the market concentration. I do not find sufficient evident to support any significant improvement of collusion.</p>
<p>Chapter two further investigates collusion by accounting for different vertical arrangements. In 2007, the major dairy processors and retailers admitted to the UK competition commission that they were involved in anti-competitive practices, such as exchanging commercially-sensitive information. This chapter assesses the outcome of such anti-competitive behaviours. It generates a menu of outcomes under different vertical and horizontal competition scenarios. Then, it uses an encompassing test to find the scenario most consistent with the reality. The results suggest that the observed market prices are most consistent with two scenarios; 1) the perfectly competitive (Bertrand) manufacturers and noncooperative Cournot retailers under a linear vertical arrangement, and 2) the noncooperative Cournot retailers under a non-linear vertical contract with the manufacturers. Hence, I do not find sufficient evidence to support that the supermarkets achieved benefits beyond the static-noncoorporative level.</p>
<p>The final chapter investigates the agglomeration in quality-type among hotels in Texas. I adopt a discrete choice framework which allows for strategic interactions among firms. That is, a firm's decision could influence other firms' decisions, and vice-versa. After controlling for demand effects through area-specific variables and area-specific unobserved heterogeneity, the incentive to agglomerate in quality choice still exists. This suggests that hotels of the same quality type enjoy positive spillovers from the presence of one another.</p>
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