Identifying and characterising price leadership in British supermarkets

Jonathan S. Seaton and Michael Waterson

International Journal of Industrial Organization, 2013, vol. 31, issue 5, 392-403

Abstract: Price leadership is a concept that lacks precision. We propose a deliberately narrow, falsifiable, definition then develop it, illustrate its feasibility and test it using the two leading British supermarket chains. We find both firms engaging in leading prices upward over a range of products, with the larger being initially more dominant but the smaller increasing leadership activity to take overall leadership over time. However, more price leadership events are price reductions than price increases, consistently led by the smaller firm. Nevertheless, the increases are of larger monetary amounts than the falls, so average basket price increases over time.

Keywords: Price leadership; British supermarkets; Edgeworth cycles (search for similar items in EconPapers)
JEL-codes: L11 L81 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (30)

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Related works:
Working Paper: Identifying and characterising price leadership in British supermarkets (2012)
Working Paper: Identifying and characterising price leadership in British supermarkets (2012)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:31:y:2013:i:5:p:392-403

DOI: 10.1016/j.ijindorg.2013.07.002

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