Price Wars and Collusion in the Spanish Electricity Market

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dc.contributor.author Fabra, Natalia
dc.contributor.author Toro, Juan
dc.contributor.other EconWPA
dc.date.accessioned 2009-08-28T14:14:08Z
dc.date.available 2009-08-28T14:14:08Z
dc.date.issued 2004
dc.identifier.uri http://hdl.handle.net/10016/5018
dc.description.abstract We analyze the time-series of prices in the Spanish electricity market by means of a time varying-transition-probability Markov switching model. Accounting for changes in demand and cost conditions (which re°ect changes in input costs, capacity avail- ability and hydro power), we show that the time-series of prices is characterized by two signi¯cantly di®erent price levels. Based on a Green and Porter (1984)'s type of model that introduces several institutional details, we construct trigger variables that a®ect the likelihood of starting a price war. By interpreting the signs of the triggers, we are able to infer some of the properties of the collusive strategy that ¯rms might have followed. We obtain more empirical support to Green and Porter's model than previous studies.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.relation.ispartofseries Working paper
dc.subject.other Electricity markets
dc.subject.other Tacit collusion
dc.subject.other Markow switching
dc.title Price Wars and Collusion in the Spanish Electricity Market
dc.type workingPaper
dc.subject.eciencia Economía
dc.rights.accessRights openAccess
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