PRICE DISPERSION AND DEMAND UNCERTAINTY: EVIDENCE FROM U.S. SCANNER DATA

Eden, Benjamin

PRICE DISPERSION AND DEMAND UNCERTAINTY: EVIDENCE FROM U.S. SCANNER DATA

International Economic Review, 2018, vol. 59, issue 3, 1035-1075

Abstract: I use the Prescott (1975) hotels model to explain variations in price dispersion across items sold by supermarkets in Chicago. The effect of uncertainty about aggregate demand on price dispersion is highly significant and quantitatively important: My estimates suggest that more than 40% of the cross‐sectional standard deviation of log prices is due to demand uncertainty. I also find that price dispersion measures are negatively correlated with the average price but are not negatively correlated with the revenues from selling the good (across stores and weeks) and with the number of stores that sell the good.

Date: 2018
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https://doi.org/10.1111/iere.12296

Related works:
Working Paper: PRICE DISPERSION AND DEMAND UNCERTAINTY: EVIDENCE FROM US SCANNER DATA (2016)
Working Paper: Price Dispersion and Demand Uncertainty: Evidence from US Scanner Data (2015)
Working Paper: Price dispersion and demand uncertainty: Evidence from US scanner data (2014)
Working Paper: PRICE DISPERSION AND DEMAND UNCERTAINTY: EVIDENCE FROM US SCANNER DATA (2013)
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