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Norwegian oil market concentration and its effects on the oil service companies 1993–2013
Author(s) -
Bruno Lars Christian,
Steen Riana
Publication year - 2022
Publication title -
scottish journal of political economy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.4
H-Index - 46
eISSN - 1467-9485
pISSN - 0036-9292
DOI - 10.1111/sjpe.12304
Subject(s) - norwegian , profitability index , market power , industrial organization , business , generalized method of moments , service (business) , tertiary sector of the economy , production (economics) , bargaining power , market concentration , petroleum industry , economics , marketing , econometrics , market structure , microeconomics , finance , panel data , monopoly , engineering , philosophy , linguistics , environmental engineering
This paper explores the effect of market concentration of the Norwegian oil production sector (NPS) on Norway's second‐largest industry, the oilfield services companies (OFS). To capture this effect, we use the system generalized method of moments approach (GMM) to estimate an empirical model, spanning the period 1993–2013. The findings indicate that increased market concentration is consistent with lower profitability of the oilfield services companies, as the bargaining power of oil companies relative to service companies increases. Increased knowledge about this effect could contribute to improving strategies for the further development of these industries by stakeholders.