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- W2003015412 abstract "The purpose of the study reported in this paper is to add to the empirical literature concerning market power and competition between railroads. In particular, the paper examines the effect of railroad mergers on railroad market power. This is achieved through a case study of the transportation market for the export of Kansas wheat to Houston, Texas. The models, techniques, and general conclusions of the study can be applied to similarly situated regional transportation markets for homogeneous goods such as coal, ores, field crops, and lumber. Two models are developed to achieve the objectives of the study. A network model of the wheat logistics system is used to identify the least cost transportation routes from the Kansas study area to the market at Houston. A profit improvement algorithm, which identifies Nash equilibrium prices, is developed to measure the amount by which railroads can profitably raise their prices above variable cost. The results of the study have implications for United States railroad merger policy. The paper indicates that railroad mergers do not necessarily increase railroad market power or make railroad shippers worse off. Instead, the study demonstrates that the impact of railroad mergers on shippers and railroads depends on factors that vary geographically, such as the degree of intrarailroad and intermodal competition in the area." @default.
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- W2003015412 date "2001-04-01" @default.
- W2003015412 modified "2023-09-26" @default.
- W2003015412 title "Simulating the Effects of Railroad Mergers" @default.
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- W2003015412 doi "https://doi.org/10.2307/1061579" @default.
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