Case Study: Car Price Differential's in European Union

Car Price Differentials in the European Union: An Economic Analysis

An investigation for the Competition Directorate-General of the European Commission

November 2000

Hans Degryse and Frank Verboven K. U. Leuven and C.E.P.R.

CENTRE FOR ECONOMIC POLICY RESEARCH, LONDON

This report was produced by Hans Degryse and Frank Verboven of K.U.Leuven and C.E.P.R. for DG Competition and represents Mr. Degryse and Mr. Verboven’s views on the subject matter. These views have not been adopted or in any way approved by the Commission and should not be relied upon as a statement of the Commission’s or DG Competition’s views. The European Commission does not guarantee the accuracy of the data included in this report, nor does it accept responsibility for any use made thereof.

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EXECUTIVE SUMMARY.....................................................................................................................3 PREVIOUS DOCUMENTATION ON EU CAR PRICE DIFFERENTIALS.............................................................3 THE COMPARATIVE CAR PRICE STUDY....................................................................................................6 Data ..................................................................................................................................................6 General framework ...........................................................................................................................6 Methodological details......................................................................................................................8 Results...............................................................................................................................................9 Drawing policy implications...........................................................................................................17 1. PREVIOUS DOCUMENTATION ON EU CAR PRICE DIFFERENTIALS .........................22 1.1 STUDIES...