Markups Across Space and Time

Eric Anderson, Sergio Rebelo () and Arlene Wong

No 24434, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study the behavior of markups in the retail sector. Markups are measured with gross margins computed at the product level using the replacement cost for every item. We find that: (1) markups are relatively stable over time and mildly procyclical; (2) there is a large regional dispersion in markups; (3) regions with higher incomes have higher markups; (4) these higher markups do not result from less intense competition or regional differences in marginal costs; and (5) regional differences in markups are due to variations in assortment, not to deviations from uniform pricing practices. We propose a simple model consistent with these facts.

JEL-codes: E3 (search for similar items in EconPapers)
Date: 2018-03
New Economics Papers: this item is included in nep-mac and nep-ure
Note: EFG ME
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Citations: View citations in EconPapers (37)

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Related works:
Working Paper: Markups Across Space and Time (2020)
Working Paper: Markups Across Space and Time (2020)
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