I estimate a demand model for car inspection services to investigate car owners' choice of stations and its implications for competition, and to evaluate the impact on consumer welfae of removing the state monopoly on inspection services. Using detailed data on car owners' choices of station in the Swedish motor vehicle inspection market, I find that car owners are willing to pay SEK 41 or 9\% more than the average price to avoid traveling one additional kilometer. Consumers are also found to respond to price, opening hours, and the size of the station. Stations that face more competitors also face more elastic demand with respect to price and opening hours. Improvement in spatial accessibility to stations following the removal of the monopoly increases welfare to the average consumer by SEK 100.
|Publication status||Unpublished - 2018|
Subject classification (UKÄ)
- Deregulation, choice, consumer welfare, motor vehicle inspection market