Asymmetric fuel pricing in transition economies: The case of Moscow

Empirical studies (Bacon, 1991; Peltzman, 2000) show that output prices tend to respond faster to input price increases than to decreases. This paper finds out such asymmetry in the fuel market of Moscow and analyzes the influence of companies' and market characteristics on asymmetric response. The conclusion is that different mechanisms of the phenomenon, including tacit collusion and consumer search, probably coexist in the Moscow retail gasoline market.Russia, Kazakhstan, market concentration, gasoline, asymmetric response