Imperfect competition in retailing

Concurrence imparfaite dans le commerce de détail

Marie-Laure Allain and Claire Chambolle ()
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Marie-Laure Allain: IP Paris - Institut Polytechnique de Paris
Claire Chambolle: UMR PSAE - Paris-Saclay Applied Economics - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

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Abstract: Retailers usually sell a large number of products to consumers who have limited information about prices and product availability. The prevalence of search costs and shopping costs leads to consumers' "one-stop shopping" behaviour. Retailers' pricing strategies are thus complex and include various promotional activities. Competition within the retail industry is heterogeneous across retail sectors and formats. Within each sector, retailers are usually differentiated along multiple dimensions, including store size and location, product variety and quality, price positioning, and the range of services offered. The variety of competitive situations in the retail sector is also reflected in the market entry strategies of retailers, influenced by the opposing forces of aggregation and competition, which reflect the different types of externalities between stores. In this entry we analyse competition among the various retail formats. We discuss the shortcomings of concentration estimates in the retail sector. Finally, we analyse market power in the supply chain.

Date: 2025-12-25
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Published in Camal Gallouj; Faïz Gallouj. Elgar Encyclopedia of Retailing, Edward Elgar Publishing, pp.238-241, 2025, Business 2025, 9781035319695. ⟨10.4337/9781035319701.00071⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05626083

DOI: 10.4337/9781035319701.00071

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