| 摘要 | ABSTRACT
1. Significance and Purpose of Study
Asymmetric pricing refers to rapid price hikes during times with triggers which raise prices, compared to a slow decline or lower price during periods with factors which tend to cause a drop in prices. A petroleum product market study refers to such phenomena as ��rockets and feathers.�� In other words, when crude oil prices go up, product prices skyrocket, whereas when crude prices go down, prices show a moderate decline, similar to a feather floating down. A number of debates on the asymmetry of gasoline prices in Korea began after the era of high oil prices in the first decade of the 2000��s, with the price of petroleum products showing virtually no sign of declining. These fostered a great number of studies on asymmetric pricing (Sohn and Na, 2002; Moon and Kim, 2004; Lee and Shin, 2006). In 2011, with a rise in gas prices in Korea and around the world, consumer complaints started to increase, impelling the Korean government to organize a team of oil market professionals to review the reasons behind this pricing phenomenon, and devise ways to set up a price system based on a proper recognition of Korea��s supply and demand. As a result, several causes of price asymmetry were identified, including the hierarchical structure of the petroleum product distribution market, and limitations on consumers�� options. The selection of domestic prices, in tandem with international petroleum product prices, also failed to properly take into account the supply and demand of the Korean market, causing the price to remain artificially high. As for the ways to enhance market conditions, the expansion of the price disclosure system, establishment of a product trading market, and mandatory consistency between pole signs of oil refineries and goods for sale—allowing hybrid products—were implemented. Since then, Korea National Oil Corp��s Opinet service, which was established to locate variances in gasoline prices, has been implemented to improve the market system and stabilize prices, resulting in an easing of the controversy over price asymmetry.
In comparison to recent international oil prices, which have dropped to a great extent, Korea��s gasoline prices have not declined greatly, leading to the further accentuation of asymmetry at the pump. Recently, academia, media, and civic groups have raised the suggestion that this asymmetric price adjustment has occurred as a result of unfair market competition and non-elastic pricing due to a high proportion of fuel tax. However, the factors behind such phenomena have not been analyzed fully.
The following study, based on the industrial organization theory, takes a closer look at the decision-making patterns of sellers and consumers in the gas station market when oil prices systematically increase at home and abroad, and examines the impact of these patterns on prices at the pump. First of all, concerning the decision-making pattern of consumers, the Consumer Price Search Theory (Chandra and Tappata, 2011) was used to explain the searching behavior to find more affordable gas in uncertain situations. The seller��s decision-making pattern was analyzed using the Edgeworth Price Cycle (Noel, 2009), which models the price reduction competition of retailers when wholesale prices increase. Lastly, with the combination of the two research findings, the impact of the asymmetric price phenomenon on nearby surroundings, including population density and consumer price sensitivity, was examined. It was determined that the asymmetric pricing was influenced by the responses of the market players in relation to price changes.
2. Research Details and Findings
This study integrates the Edgeworth Price Cycle with the Consumer Price Search Theory, explaining the price asymmetry of gas stations in tandem with the impact of oil prices at home and abroad through the analysis of decision-making patterns of sellers and consumers within the market.
If gasoline prices increase with a hike in wholesale prices, consumers show a tendency to look for cheaper gas; the level of this tendency differs by consumer. At this point, gas station owners are highly likely to offer lower prices in order not to lose customers to a competitor. If the periods of declining prices become shorter, price asymmetry can be expected to weaken. On the other hand, if consumers are less willing to search for better prices and owners respond slowly to price changes, the frequency of price asymmetry will presumably increase.
The decision-making pattern of consumers (the criteria by which consumers select gas stations)was analyzed in 25 districts in Seoul by setting the elasticity beta regarding the degree of price competition among gas stations in accordance with the distance between competing gas stations. (��Beta�� refers to elasticity where, unlike pricing, the targets of elasticity cannot be physically observed). Beta demonstrates the elasticity of consumer demand in regards to incomplete information based on price competition among gas stations. In general, consumer preference and the concept of utility can rarely be observed in consumer analysis, but according to the Revealed Preference Theory, consumer preference is measured by setting the price competition among gas stations as a medium. Consumers with relatively higher beta were more sensitive about asymmetry information, implying that they showed a tendency to respond quickly to price fluctuation at gas stations. Furthermore, beta is influenced greatly by the environment, including transportation options and population density. For example, in downtown areas where population density is generally high, with sufficient transportation options to replace automobiles, beta appears to have higher values. In order to examine the contributions of Opinet, which was established to provide consumers with prices at nearby gas stations, a series of experiments were conducted to identify whether the effect of a gas price reduction occurs before or after the use of Opinet, and if there is a difference between Opinet users and non-users. Consumers who filled up their tanks in areas with low population density and insufficient beta appear to have gained more benefit from Opinet. Consumers from big beta areas search diligently for affordable gas without the support of Opinet. The contribution of Opinet therefore appears to be minimal.
According to the regression analysis, when wholesale prices show an upward trend, the areas with higher beta tend to show severe price competition at gas stations, with less price variance compared to other areas. In other words, the asymmetric impact of the wholesale price on retail price variance differs depending on consumer characteristics toward price variation.
From the seller��s perspective, during the sample period, based on the average of 25 districts in Seoul and with the use of average data from gas stations on a weekly basis, it was examined whether the variation of gasoline retail prices follows the patterns predicted by the Edgeworth Price Cycle.
Within the Edgeworth Price Cycle, companies, as a means of expanding the market, engage in price reduction competition repetitively, and such competition continues until the price reaches the marginal cost. At this point, the price increases or remains at marginal cost. When two companies get into fierce price competition, the asymmetric price variation tends to show repetitive patterns. In this regard, Seoul��s total average retail price of gasoline showed a higher frequency of price reduction compared to price hikes during the sample period, showing asymmetry in both the upward and downward price trends, with a bigger price variation in periods of rising prices. In addition, price variation appears to be in inverse proportion to current margin. Thus, in periods of increasing prices, the price variation reduces as the price reaches its peak. If the price declines after hitting the peak, the price variation is large in the beginning, but becomes smaller as the price approaches the bottom. With respect to the variation of wholesale prices (the cost to gas stations) reactions are noticeable in periods of increasing prices, which implies the cost-pricing asymmetry.
On the other hand, using the average price data for the 25 districts in Seoul, a clear discrepancy was noted between the price cycle and the asymmetry involving the upward and downward trend of prices by district. In particular, Guro-gu and Jungnang-gu both showed long price cycles with a strong level of asymmetry between the upward and downward price trends. Conversely, Gangseo-gu showed a longer price cycle than Jungnang-gu, but weaker asymmetry. Dongjak-gu appeared to have the shortest price cycle with weak asymmetric pricing.
Lastly, based on the combination of the results of both consumer and seller patterns, the correlation between surroundings, such as beta and population density and the Edgeworth Price Cycle, was analyzed. As a result, a significant policy consensus has been reached. It can be determined that as consumers respond actively to price variation through price searching, price competition among gas stations will increase, eventually weakening asymmetric pricing. This fact is explained more by an analysis of the correlation between local statistics and asymmetric pricing. As population density increases, the number of consumers searching for better prices goes up and the Edgeworth Price Cycle gradually disappears. To sum up, generation, population, number of households, increase in population density, and resident demand play an important role in increasing the amount of public transportation available. Automobile owners respond more sensitively to price variations and as the variation increases, asymmetric pricing declines.
3. Policy Implications
This study suggests that the asymmetry involving the upward and downward trend of prices is not necessarily caused by unfair price competition, but rather by companies�� efforts to maximize long-term profits in consideration of consumers�� reactions to price. In the past, asymmetric pricing was deemed to be the result of unfair competition, including collusion among oil refinery companies, but according to the study, the asymmetric pricing phenomenon was triggered by incomplete information found at the market equilibrium point where demand (from the consumer) and supply (from the seller) met. Therefore, the asymmetric pricing phenomenon should not be evaluated simply through the aggregate price by city, but should be analyzed systematically considering the characteristics of consumers and sellers in each region.
The effect of the price comparison systems of nearby gas stations, including Opinet and GPS, also differ by region, depending on consumer characteristics. Therefore, it is recommended to devise measures to maximize consumer benefits while taking consumers�� differentiated demands into account in the future. |
