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Theoretical Model of Pricing Behavior on the Polish Wholesale Fuel Market

Folia Oeconomica Stetinensia

Volume 16 (2016): Issue 1 (December 2016)

By: Sylwester Bejger

Open Access

|Dec 2016

Abstract

In this paper, we constructed a theoretical model of strategic pricing behavior of the players in a Polish wholesale fuel market. This model is consistent with the characteristics of the industry, the wholesale market, and the players. The model is based on the standard methodology of repeated games with a built-in adjustment to a focal price, which resembles the Import Parity Pricing (IPP) mechanism. From the equilibrium of the game, we conclude that the focal price policy implies a parallel pricing strategic behavior on the market.

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Articles in this issue

DOI: https://doi.org/10.1515/foli-2016-0019 | Journal eISSN: 1898-0198 | Journal ISSN: 1730-4237

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Language: English

Page range: 286 - 300

Submitted on: Nov 3, 2015

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Accepted on: Jun 27, 2016

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Published on: Dec 30, 2016

Published by: University of Szczecin

In partnership with: Paradigm Publishing Services

Publication frequency: 2 issues per year

Keywords:

wholesale fuel market,

strategic behavior,

focal pricing game,

parallel pricing

Related subjects:

Business and economics,

Political economics,

Political economics, other

© 2016 Sylwester Bejger, published by University of Szczecin
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Volume 16 (2016): Issue 1 (December 2016)

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