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Retail Prices for Milk by Fat Content: A New Theory and Empirical Test of Retailer Pricing Behavior 31
Xia, Tian; Sexton, Richard J..
We study a heretofore unexamined type of product differentiation, horizontally differentiated products with differential costs, and apply the analysis to retail pricing of fluid milk products. The theoretical models yield unique predictions for the relationship among prices of the four horizontally differentiated fluid milk products (skim, 1%, 2%, and whole milk) and the impacts of butterfat and nonfat milk costs on prices, depending upon the form of retail competition. An empirical analysis of retail milk pricing for four major cities in California enables tests to be conducted of which form of behavior best characterizes grocery retailing in these cities.
Tipo: Report Palavras-chave: Differential costs; Horizontal differentiation; Milk; Oligopoly; Retail pricing; Demand and Price Analysis; Livestock Production/Industries.
Ano: 2009 URL: http://purl.umn.edu/54546
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Consumers and sellers heterogeneity, search costs and spatial price dispersion in retail food markets 31
Anania, Giovanni; Nistico, Rosanna.
— Price dispersion, i.e. a homogeneous product sold at different prices by different sellers, is among the most replicated findings in empirical economics. The paper assesses the extent and determinants of spatial price dispersion for 14 perfectly homogeneous food products in more than 400 retailers in a market characterized by the persistence of a large number of relatively small traditional food stores, side by side with large supermarkets. The extent of observed price dispersion is quite high, suggesting that, despite their large number, monopolistic competition prevails among sellers as a result of the heterogeneity of services offered. When prices in an urban area (where the spatial concentration of sellers is much higher and consumer search costs...
Tipo: Conference Paper or Presentation Palavras-chave: Price dispersion; Retail pricing; Food markets.; Agribusiness; Agricultural and Food Policy; Community/Rural/Urban Development; Food Consumption/Nutrition/Food Safety; Labor and Human Capital.
Ano: 2010 URL: http://purl.umn.edu/94921
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Consumption Inertia and Asymmetric Price Transmission 31
Xia, Tian; Li, Xianghong.
We propose consumption inertia as a new explanation for asymmetric price transmission. Inertia in consumer demand enlarges retailers’ gains in gross profits from raising prices in response to higher wholesale prices and reduces gains from decreasing prices in response to lower wholesale prices. Thus, consumption inertia can cause asymmetries in price transmission whereby retailers are more willing to change their prices, and change them more quickly, in response to wholesale price increases as opposed to wholesale price decreases.
Tipo: Journal Article Palavras-chave: Asymmetric price transmission; Consumption inertia; Market power; Retail pricing; Demand and Price Analysis.
Ano: 2010 URL: http://purl.umn.edu/93210
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