Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2015-06-24
Number: 15-075/VIII
Author-Name: Christiaan Behrens
Author-Workplace-Name: VU University Amsterdam
Author-Name: Mark Leijsen
Author-Workplace-Name: VU University Amsterdam
Title: Measuring Competition Intensity; An Application to Air/HSR Transport Markets
Abstract: We develop a method to measure the intensity of competition between firms. Our method, which we call the Best Response Measure (BRM), is related to the conduct parameter method,
but avoids the main problems associated with that method. The BRM relies on a very general framework and limited data requirements. Moreover, we show that it provides valuable
information in determining the relevant market. We illustrate how the BRM can be used in markets with imperfect substitutes and apply the method to aviation markets in the North Sea area. This also enables us to establish to what extent the high speed rail link between London and the European mainland affects the supply by air carriers.
Classification-JEL: D22, D43, L10, L93, R41
Keywords: inter- and intramodal competition, aviation, spatial networks, high-speed rail
File-Url: https://papers.tinbergen.nl/15075.pdf
File-Format: application/pdf
File-Size: 1213813 bytes
Handle: RePEc:tin:wpaper:20150075