Stationarity Tests in Geographic Market Definition: An Application to South African Milk Markets

South African Journal of Economics, Vol. 75, No. 1, pp. 52-65, 2007

Posted: 27 Mar 2010

See all articles by Willem H. Boshoff

Willem H. Boshoff

Stellenbosch University - Department of Economics - Centre for Competition Law and Economics

Date Written: March 1, 2007

Abstract

The paper focuses on the delineation of geographic markets in competition analysis, investigating the use of tests of price co-movement in the market definition exercise. To this end, the first part is devoted to a conceptual framework for market definition (adopted from Haldrup (2003)). Thereafter, a variety of price tests are explored that can be applied within the quantitative part of the framework. Similar to Forni (2004), the paper emphasizes the use of stationarity tests (that is, tests for the existence of unit roots) – illustrating their application to a recent competition investigation in South Africa.

Keywords: market definition, unit root, panel unit root, delineation, quantitative, stationarity tests, prices

JEL Classification: L4, L41, L43, D4

Suggested Citation

Boshoff, Willem H., Stationarity Tests in Geographic Market Definition: An Application to South African Milk Markets (March 1, 2007). South African Journal of Economics, Vol. 75, No. 1, pp. 52-65, 2007, Available at SSRN: https://ssrn.com/abstract=1576482

Willem H. Boshoff (Contact Author)

Stellenbosch University - Department of Economics - Centre for Competition Law and Economics ( email )

South Africa
+27218082387 (Phone)

HOME PAGE: http://ccle.sun.ac.za

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
415
PlumX Metrics