Working Paper: NBER ID: w7435
Authors: Asher A. Blass; Dennis W. Carlton
Abstract: This paper uses a new data source to analyze the choice of organizational form of retail gasoline stations. In recent years, gasoline stations have tended to be less likely to be owned and operated by a lessee dealer and more likely to be owned and operated by the refiner. Critics have alleged that company-operated stations are used to drive lessee dealer stations out of business in order to restrict competition. We examine the determinants of organizational form and find them to be based on efficiency not predatory concerns. We estimate the costs of recent laws prohibiting company ownership of gasoline stations.
Keywords: gasoline retailing; organizational form; divorcement laws; investment behavior
JEL Codes: L51; L94
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| investment behavior (G11) | operational form of stations (L92) |
| company-operated stations (L32) | market conditions (P42) |
| mode of operation (company-operated vs. dealer-operated) (L81) | efficiency considerations (D61) |
| divorcement legislation (J12) | investment rates in new stations (H54) |