Antitrust and Sales-Below-Cost Laws: The Case of Retail Gasoline

Antitrust and Sales-Below-Cost Laws: The Case of Retail Gasoline Numerous states have sales-below-cost (SBC) laws, often directed at specific products such as gasoline. Potential violations of state SBC laws occur when prices are less than the seller's cost of doing business, or some proxy thereof. The most commonly stated purpose of these laws is to protect small independent firms from predation by larger firms. This study offers empirical evidence on the impact of SBC laws on the retail gasoline market. The result indicate that SBC laws directed specifically at the retail gasoline market have resulted in higher retail margins. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Review of Industrial Organization Springer Journals

Antitrust and Sales-Below-Cost Laws: The Case of Retail Gasoline

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Publisher
Kluwer Academic Publishers
Copyright
Copyright © 1999 by Kluwer Academic Publishers
Subject
Economics; Industrial Organization; Microeconomics
ISSN
0889-938X
eISSN
1573-7160
D.O.I.
10.1023/A:1007728100373
Publisher site
See Article on Publisher Site

Abstract

Numerous states have sales-below-cost (SBC) laws, often directed at specific products such as gasoline. Potential violations of state SBC laws occur when prices are less than the seller's cost of doing business, or some proxy thereof. The most commonly stated purpose of these laws is to protect small independent firms from predation by larger firms. This study offers empirical evidence on the impact of SBC laws on the retail gasoline market. The result indicate that SBC laws directed specifically at the retail gasoline market have resulted in higher retail margins.

Journal

Review of Industrial OrganizationSpringer Journals

Published: Oct 15, 2004

References

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