The Elusive Law of One Retail Chain Price

Nicoletta Berardi

Journal of Industry, Competition and Trade, 2023, vol. 23, issue 3, No 6, 281 pages

Abstract: Abstract We investigate whether prices for identical products differ across more than 1600 French supermarkets and find non-trivial price dispersion, albeit more limited than in other countries. We determine that more than 80% of the total variance of the observed dispersion of relative prices across stores and time is explained by the spatial permanent component (stores consistently sell products at relatively high or low prices), essentially driven by persistent heterogeneity in retail chain pricing. The analysis of between and within retail chain price dispersion also provides evidence consistent with a rather centralized multi-stage price setting, in which local stores play a much smaller role than retail buying groups and local branches.

Keywords: Price dispersion; Retail chain pricing; Multi-stage price setting (search for similar items in EconPapers)
JEL-codes: D40 E31 L11 L81 (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s10842-023-00404-3

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