Relevance and detection problems of margin squeeze: The case of German gasoline prices

Arbeitspapier

In contrast to the United States, Germany decided to add margin squeeze as a legal offense to German competition law. In response to this, the problems in the gasoline market have caused major debates. This paper examines the pricing strategies by gasoline retailers and discusses the difficulties experienced by regulators dealing with cases of margin squeeze occurrence of the phenomenon and outlines the dilemma of the margin squeeze. First the three possibilities to detect margin squeezes are presented. Afterwards the problems in applying the concept in case of the gasoline market, for which it was initially designed, are discussed. On the one hand, there are very few obvious cases in the gasoline market in which retail prices and wholesale prices are a clear indicator for margin squeeze. On the other hand, applying the "equally-efficient" approach always involves assumptions of having knowledge of the companies' cost functions. When applying the "equally-efficient"-approach, there are cases of margin squeezes at the cost of having only educated guesses and no solid proof. When considering the wholesale price to detect margin squeeze cases on the gasoline retail market, there are nearly no cases of margin squeezes. The difficulty to find a proper way of calculating equal efficiency or reasonable efficiency and the lack of margin squeeze cases when referring to wholesale and retail prices of gasoline constitute the dilemma of the element of offence "margin squeeze".

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Paper Series in Economics ; No. 355

Classification and Topics

• Classification: Wirtschaft ; Antitrust Law ; Monopoly; Monopolization Strategies ; Vertical Restraints; Resale Price Maintenance; Quantity Discounts
• Subject: Preiswettbewerb ; Benzinpreis ; Wettbewerbsrecht ; Deutschland

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kleineberg, Christoph ; Wein, Thomas
• Event: Veröffentlichung
• (who): Leuphana Universität Lüneburg, Institut für Volkswirtschaftslehre
• (where): Lüneburg
• (when): 2015

Further information

• Handle: http://hdl.handle.net/10419/155663
• Last update: 10.03.2025, 11:44 AM CET