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On the Evaluation of Market Power and Market Dominance: The Nordic Electricity Market
Responsible organisation
2009 (English)In: Energy Policy, ISSN 0301-4215 , Vol. 37, no 8, 3235-3241 p.Article in journal (Refereed) Published
Abstract [en]

This paper studies different concentration and dominance measures using structural indexes used to initially screen the competitive situation in a market. The Nordic and Swedish electricity markets are used as the empirical cases. Market concentration issues in the Nordic electricity market in general and in Sweden in particular have been, at least in initial screenings, approached by the Herfindahl-Hirschman-Index (HHI). This article uses an alternative measure to HHI, which is based on market shares of the two largest firms in the market. The results shows that only the Swedish wholesale market has a firm that can be regarded as dominant, but only during very short periods. The results from a hypothetical merger between the second and third largest company in the Swedish wholesale market shows that when the dominant position of the largest firm is reduced, by increasing the size of the second largest firm, the threshold value indicates that competition actually will increase (contradicting to the HHI).

Place, publisher, year, edition, pages
Elsevier , 2009. Vol. 37, no 8, 3235-3241 p.
Keyword [en]
Market dominance, Electricity market, Herfindahl-Hirschman Index
National Category
Economics Business Administration
URN: urn:nbn:se:bth-7964DOI: 10.1016/j.enpol.2009.04.014ISI: 000267417300042Local ID: diva2:835645
Available from: 2012-09-18 Created: 2009-09-01 Last updated: 2015-06-30Bibliographically approved

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