IDEAS home Printed from https://ideas.repec.org/a/ags/nejare/28856.html
   My bibliography  Save this article

Market Structure And The Dynamics Of Retail Food Prices

Author

Listed:
  • Weaver, Robert D.
  • Chattin, Peter
  • Banerjee, Aniruddha

Abstract

The effect of retail grocery market structure on the speed of adjustment of retail food prices to changes in producer prices, real wages, and the cost of energy was examined for SMSAs. Evidence failed to support the implication of the Mason-Bain paradigm that increased concentration reduces market efficiency as reflected in speed of retail price adjustment. Evidence of strong intertemporal relationships between change in producer prices and retail prices found for the categories meat, poultry, fish, eggs and cereal and baker products provide support to the hypothesis of cost-push inflation.

Suggested Citation

  • Weaver, Robert D. & Chattin, Peter & Banerjee, Aniruddha, 1989. "Market Structure And The Dynamics Of Retail Food Prices," Northeastern Journal of Agricultural and Resource Economics, Northeastern Agricultural and Resource Economics Association, vol. 18(2), pages 1-11, October.
    • Handle: RePEc:ags:nejare:28856
    DOI: 10.22004/ag.econ.28856
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/28856/files/18020160.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.28856?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Steven Salop & Joseph Stiglitz, 1977. "Bargains and Ripoffs: A Model of Monopolistically Competitive Price Dispersion," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 493-510.
    2. Frederick E. Geithman & Bruce W. Marion, 1978. "A Critique of the Use of BLS Data for Market Structure-Price Analysis," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 60(4), pages 701-705.
    3. Schmalensee, Richard, 1989. "Inter-industry studies of structure and performance," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 16, pages 951-1009, Elsevier.
    4. Lamm, R McFall, 1981. "Prices and Concentration in the Food Retailing Industry," Journal of Industrial Economics, Wiley Blackwell, vol. 30(1), pages 67-78, September.
    5. Kwoka, John E, Jr, 1981. "Does the Choice of Concentration Measure Really Matter?," Journal of Industrial Economics, Wiley Blackwell, vol. 29(4), pages 445-453, June.
    6. Schroeter, John R, 1988. "Estimating the Degree of Market Power in the Beef Packing Industry," The Review of Economics and Statistics, MIT Press, vol. 70(1), pages 158-162, February.
    7. Appelbaum, Elie, 1979. "Testing price taking behavior," Journal of Econometrics, Elsevier, vol. 9(3), pages 283-294, February.
    8. Gaskins, Darius Jr., 1971. "Dynamic limit pricing: Optimal pricing under threat of entry," Journal of Economic Theory, Elsevier, vol. 3(3), pages 306-322, September.
    9. Bruce W. Marion & Willard F. Mueller & Ronald W. Cotterill & Frederick E. Geithman & John R. Schmelzer, 1979. "The Price and Profit Performance of Leading Food Chains," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 61(3), pages 420-433.
    10. repec:bla:econom:v:46:y:1979:i:183:p:295-300 is not listed on IDEAS
    11. R. McFall Lamm & Paul C. Westcott, 1981. "The Effects of Changing Input Costs on Food Prices," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 63(2), pages 187-196.
    12. Duncan, Gregory M., 1987. "A simplified approach to M-estimation with application to two-stage estimators," Journal of Econometrics, Elsevier, vol. 34(3), pages 373-389, March.
    13. Cotterill, Ronald W, 1986. "Market Power in the Retail Food Industry: Evidence from Vermont," The Review of Economics and Statistics, MIT Press, vol. 68(3), pages 379-386, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. G. R. Chen, 2016. "Dynamic Model for Market Competition and Price Rigidity," Applied Economics, Taylor & Francis Journals, vol. 48(36), pages 3485-3496, August.
    2. Rahkovsky Ilya & Volpe Richard, 2018. "Structure and Food Price Inflation," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 16(1), pages 1-16, January.
    3. Liu, Yamei, 2000. "Overfitting and forecasting: linear versus non-linear time series models," ISU General Staff Papers 2000010108000014914, Iowa State University, Department of Economics.
    4. Frigon, Mathieu & Doyon, Maurice & Romain, Robert F.J., 1999. "Asymmetry in Farm-Retail Price Transmission in the Northeastern Fluid Milk Market," Research Reports 25220, University of Connecticut, Food Marketing Policy Center.
    5. Shailender Singh & Chen Guan-Ru, 2020. "Modeling variations in price inertia under demand uncertainty," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 19(1), pages 26-42, February.
    6. Emilio Galdeano-Gómez, 2007. "Composite price expectations: An empirical analysis for the Spanish horticultural sector," Agribusiness, John Wiley & Sons, Ltd., vol. 23(1), pages 57-83.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Perloff, Jeffrey M, 1991. "Econometric analysis of imperfect competition and implications for trade research," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt46w1j22d, Department of Agricultural & Resource Economics, UC Berkeley.
    2. Binkley, James K. & Connor, John M., 1996. "Market Competition And Metropolitan-Area Grocery Prices," Working Papers 25988, Regional Research Project NE-165 Private Strategies, Public Policies, and Food System Performance.
    3. Meilin Ma & Tina L. Saitone & Richard J. Volpe & Richard J. Sexton & Michelle Saksena, 2019. "Market Concentration, Market Shares, and Retail Food Prices: Evidence from the U.S. Women, Infants, and Children Program," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(3), pages 542-562, September.
    4. Lars-Hendrik Röller & Johan Stennek & Frank Verboven, 2006. "Efficiency Gains from Mergers," Chapters, in: Fabienne IIzkovitz & Roderick Meiklejohn (ed.), European Merger Control, chapter 3, Edward Elgar Publishing.
    5. Meilin Ma & Tina L Saitone & Richard J Volpe & Richard J Sexton & Michelle Saksena & Craig GundersenEditor, 2019. "Market Concentration, Market Shares, and Retail Food Prices: Evidence from the U.S. Women, Infants, and Children Program," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 41(3), pages 542-562.
    6. Perekhozhuk, Oleksandr, 2007. "Marktstruktur und Preisbildung auf dem ukrainischen Markt für Rohmilch," Studies on the Agricultural and Food Sector in Transition Economies, Leibniz Institute of Agricultural Development in Transition Economies (IAMO), volume 41, number 92322.
    7. Kyle W. Stiegert & Todd Sharkey, 2007. "Food pricing, competition, and the emerging supercenter format," Agribusiness, John Wiley & Sons, Ltd., vol. 23(3), pages 295-312.
    8. Bruce Marion, 1998. "Competition in Grocery Retailing: The Impact of a New Strategic Group on BLS Price Increases," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 13(4), pages 381-399, August.
    9. Connor, John M., 1999. "Evolving Research On Price Competition In The Grocery Retailing Industry: An Appraisal," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 28(2), pages 1-9, October.
    10. Wann, Joyce J. & Sexton, Richard J., 1991. "Imperfect Competition In Multiproduct Food Industries With Application To Pear Processing," 1991 Annual Meeting, August 4-7, Manhattan, Kansas 271370, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. A. M. Azzam, 1992. "Testing The Competitiveness Of Food Price Spreads," Journal of Agricultural Economics, Wiley Blackwell, vol. 43(2), pages 248-256, May.
    12. Lambert, David K. & Miljkovic, Dragan, 2010. "The sources of variability in U.S. food prices," Journal of Policy Modeling, Elsevier, vol. 32(2), pages 210-222, March.
    13. Kenji Matsui, 2010. "Effects of wholesaler concentration on retailers by format: evidence from Japanese brand-level price data," Applied Economics, Taylor & Francis Journals, vol. 42(18), pages 2379-2391.
    14. Hernant, Mikael & Julander, Claes-Robert, 2020. "Does local competition make a difference for store profitability?: An empirical study of 168 Swedish supermarkets," SSE Working Paper Series in Business Administration 2020:4, Stockholm School of Economics.
    15. Sascha A. Weber & Sven M. Anders, 2007. "Price rigidity and market power in German retailing," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 28(7), pages 737-749.
    16. Davis, David E., 2009. "Price and promotion effects of supermarket mergers," SDSU Working Papers in Progress 12009, South Dakota State University, Department of Economics, revised Jun 2010.
    17. O. Cem Ozturk & Sriram Venkataraman & Pradeep K. Chintagunta, 2016. "Price Reactions to Rivals’ Local Channel Exits," Marketing Science, INFORMS, vol. 35(4), pages 588-604, July.
    18. Catherine A. Durham, 1991. "The Empirical Analysis of Oligopsony in Agricultural Markets: Residual Supply Estimation in California's Processing Tomato Market," Food Marketing Policy Center Research Reports 015, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
    19. Volpe, Richard, 2011. "The Relationship Between National Brand and Private Label Food Products: Prices, Promotions, Recessions, and Recoveries," Economic Research Report 262234, United States Department of Agriculture, Economic Research Service.
    20. Spielman, David J. & Kolady, Deepthi E. & Cavalieri, Anthony & Rao, N. Chandrasekhara, 2014. "The seed and agricultural biotechnology industries in India: An analysis of industry structure, competition, and policy options," Food Policy, Elsevier, vol. 45(C), pages 88-100.

    More about this item

    Keywords

    Marketing;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:nejare:28856. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/nareaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.