| 摘要 | ��
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1.
Background and Purpose
Oil product market in Korea has gone through changes since 1995.
For example, in the early 2008, the so-called 'poll-sign system' was abolished, and daily consumer prices of gasoline and diegel have been posted on web-site for consumers. Besides, the government relaxed reservation duty for petroleum importers, permitted horizontal transactions between petroleum agencies and between gas stations, and allowed super-markets such as Nong-hyup and E-mart sell vehicle fuels through their nationwide distributive networks.
These measures reflect the will of government to improve the distribution structure for petroleum products by introducing more competition to the market. Today, the domestic market is mostly ruled
by vertically oligopolistic distribution channel in which main players are oil refining companies. Gas stations are divided into two different types: company-operation and independent ownership stations.
Conventionally, independent ownership stations are vertically constrained by one of refineries by signing a lease contract or a brand-use contract with the refinery.
Vertical constraints such as exclusive dealing contract can affect the competition in the petroleum product market. Recognizing this point, this paper theoretically investigates how the distribution structure of the market, i.e. vertical structure between gas stations and oil refining companies, results in competition level and affects social welfare in the petroleum product market.
2.
Main content
A. distribution structure of domestic petroleum product market
At the present moment, domestic vehicle fuel market is divided into two different types: gas stations that use the brand of oil refining companies(94.7%), and ones with independent brand. Further, the gas stations that use the brand of oil refining companies are categorized into two: stations under company-operation and ones under independent ownership. Company-operation stations are owned by refineries or petroleum agencies. In detail, there are four types in this category: ones that are owned and directly managed by refineries, ones that are owned by refineries, but managed by individuals under contract, ones that are owned and directly managed by petroleum agencies, and ones that are owned by the petroleum agencies, but managed by individuals under contract. The individual under contract with refineries is allowed to set retail prices, but is obligated to purchase at the contract prices the whole quantities of petroleum products which he sells in his station. On the other hand, stations under independent ownership are owned by individuals.
Company-operation stations and most of independent ownership stations traditionally make a contract for product supply and brand-use with a refinery.
Big dealers has appeared in the market since 2000. They own and/or rent 3~10 stations from refineries and from petroleum agencies.
Because they manage multiple gas stations and buy lots of petroleum products, they have strong dealing power in the market.
B. The distribution structure of petroleum product market in major overseas countries
In U.S.A., there are two types of petroleum retail distribution markets. One is distribution market that is dominated by major oil companies such as Shell, BP, and the other is independent market that
runs separated distribution terminals and transportation system. There are three categories for brand gas stations: company-operation, lessee dealer, and dealer owned. There is a jobber who is a petroleum distribution agency and owns multiple stations. An independent station is an independent retailer, purchases brand or non-brand gasoline from refineries and/or distribution rack at rack price, and sets its gasoline price. Dealer owned stations can choose the lowest wholesale price from distribution rack, and can independently set retail margin while company-operation stations cannot decide retail price, and lessee dealers are indirectly affected by a contract with a lessor. Dealer owned stations are supermarkets or hypermarkets such as discount stores.
In Japan, there are two distribution paths for gasoline: first is a path from wholesale companies to retailers via special agencies. Second is a path from distribution companies(so-called Won-mae) via the agricultural cooperative association. The distribution companies are specialized in sales and distinguished from refining companies, but some of them own refineries by capital participation. Also, the distribution companies own their gas stations. One of distinctive features of the Japanese distribution structure is that retailers are vertically constrained by long-term contract with firms in upstream market. Vertical relationship within petroleum product market is not regulated by Japanese law or institution, but it is established as custom: most of stations choose one wholesale firm, and only few of them use independent brand and deal with multiple wholesale firms.
C. Model and equilibrium
A game theoretical model is set according to types of gas stations.
Equilibrium market price and profit for each type are then calculated.
Three vertical relationships between retailers and refiners are considered in this paper: station participating in an exclusive dealing with a refinery based on lease contract, independent station purchasing from a refinery, and independent station purchasing from two firms.
Therefore, there are six different types of models considered here: 1) bilateral lease contract, 2) bilateral vertical independence (single purchase), 3) bilateral vertical independence (mixed purchase), 4) unilateral lease contract with vertical independence (single purchase), 5) unilateral lease contract with vertical independence (mixed purchase), 6) unilateral vertical independence (single purchase) and unilateral vertical independence (mixed purchase).
3.
Main results and policy implications
In domestic petroleum product market, the competition level and profit of retailers depend on the retailer's vertical relationship with refineries. There's no incentive for retailers to make an exclusive
transaction contract, because firms in upstream market would get all profits of retailers through franchise fixed cost. On the other hand, in case of vertical independence, profits of retailers are larger than 0, and it depends on fixed cost whether retailers would purchase from a refinery or from multiple refineries. If the fixed cost is sufficiently low, Nash equilibrium is the case where retailers buy from multiple refineries. On the other hand, if the fixed cost is high and product differentiation in downstream market is high, then Nash equilibrium is the case where retailers buy from a refinery.
When retailers are vertically independent, the social welfare of the mixed purchase is larger than that of the case where firms buy the whole quantity from a refinery. It is because decreased price of
product in upstream market due to the mixed purchase of retailers leads to a lower consumer price, which enables more selling in the final product market.
This analysis on prices and social welfare implies the following.
The government decided that the exclusive dealing between a gas station and a refining company violated anti-trust law, and was abolished in 2008. It created favorable market condition for retailers
in which a gas station can buy from refining firms or spot market without an exclusive contract. However, in reality, a gas station is usually owned by an independent dealer with small resources, so the owner chooses to make a lease contract or to use refining firm's brand for initial capital support and various benefits. Thus, even though the owner is not involved with exclusive dealing, he/she has to buy the whole or a significant quantity from one refining company. The price with the whole quantity purchase case are higher than that of the mixed purchase case, and social welfare with the whole quantity purchase is lower than that of the mixed purchase case.
Based on this analysis, the following policies are suggested for an efficient distribution structure of domestic petroleum product market.
First, more competition should be introduced to the domestic petroleum product market by increasing the number of players in the upstream market, i.e. petroleum importers. In order to achieve this
goal, the present distribution structure must be reformed. Customarily, a gas station buys the whole quantity from a sole refinery, which would be entry-barrier for petroleum importers. Second, additional services such as convenience store should be encouraged for gas stations with small resources that are not directly related to refining firms. Earning from the additional services, gas stations can set lower prices on petroleum products. It is not only helpful for increase in profits of the gas stations, but also for the stabilization of oil prices.
Third, active participation of big dealers should be encouraged and self-service station should be introduced more in order to lower costs in retail market. In Korea, the portion of self-service station is only 0.4% in contrast to 95% for USA and 13% for Japan. Activities of big dealers can lower petroleum product price as they buy a big amount from refining firms and petroleum agencies.
122 pages, 22 refs., 21 tabs., 16 Figs., Language: Korean |
