The Effect of Input Price Discrimination on Retail Prices: Theory and Evidence from France

L’effet de la discrimination des prix sur le marché amont sur les prix de détail: théorie et empiriques à partir du cas de la France

Marie-Laure Allain, Claire Chambolle and Stéphane Turolla
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Claire Chambolle: Université Paris-Saclay, CREST - Centre de Recherche en Économie et Statistique - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz] - X - École polytechnique - IP Paris - Institut Polytechnique de Paris - ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique - CNRS - Centre National de la Recherche Scientifique

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Abstract: We develop a model of vertical relations between national brand and private label producers and competing multi-product retailers to derive new predictions on the impact of input price discrimination on retail prices. A reform that lifted a ban on input price discrimination in France provides a natural experiment to test these predictions. Using household scanner data on food prices, we run a difference-in-differences analysis and show that the reform caused a significant decrease of the relative prices of national brand products. These results suggest a pro-competitive effect of authorizing input price discrimination.

Keywords: Input price discrimination; Policy evaluation; Food retail sector; Discrimination des prix sur le marché amont; Evaluation des politiques; Grande distribution alimentaire (search for similar items in EconPapers)
Date: 2022-10-24
New Economics Papers: this item is included in nep-agr, nep-com and nep-reg
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Working Paper: The Effect of Input Price Discrimination on Retail Prices: Theory and Evidence from France (2022)
Working Paper: The Effect of Input Price Discrimination on Retail Prices: Theory and Evidence from France (2022)
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