IDEAS home Printed from https://ideas.repec.org/a/bla/randje/v51y2020i1p189-232.html
   My bibliography  Save this article

Measuring competition in spatial retail

Author

Listed:
  • Paul B. Ellickson
  • Paul L.E. Grieco
  • Oleksii Khvastunov

Abstract

We propose and estimate a spatially aggregated discrete‐choice model with overlapping consumer choice sets and demographic‐driven heterogeneity that varies by chain. Our approach avoids the need to define markets ex ante and captures rich substitution patterns, even in the absence of price data. An application to the US grocery industry illustrates the importance of location, format, and the spatial distribution of consumers in shaping the competitive environment. Contrary to conventional wisdom, we find substantial cross‐format competition between supercenters, clubs, and traditional grocers. Finally, we evaluate two representative mergers between supermarket chains to demonstrate how our estimates inform antitrust policy.

Suggested Citation

  • Paul B. Ellickson & Paul L.E. Grieco & Oleksii Khvastunov, 2020. "Measuring competition in spatial retail," RAND Journal of Economics, RAND Corporation, vol. 51(1), pages 189-232, March.
    • Handle: RePEc:bla:randje:v:51:y:2020:i:1:p:189-232
    DOI: 10.1111/1756-2171.12310
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1756-2171.12310
    Download Restriction: no
    File URL: https://libkey.io/10.1111/1756-2171.12310?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
    ---><---

    Citations

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


    Cited by:

    1. Dmitrii Tereshchenko, 2022. "Competition among Russian Grocery Stores: Database on St. Petersburg, 2017–2021," HSE Working papers WP BRP 258/EC/2022, National Research University Higher School of Economics.
    2. Bonfrer, André & Chintagunta, Pradeep & Dhar, Sanjay, 2022. "Retail store formats, competition and shopper behavior: A Systematic review," Journal of Retailing, Elsevier, vol. 98(1), pages 71-91.
    3. Mai, Enping (Shirley) & Ketron, Seth, 2022. "How retailer ownership of vs. collaboration with sharing economy apps affects anticipated service quality and value co-creation," Journal of Business Research, Elsevier, vol. 140(C), pages 684-692.
    4. Lauren Chenarides & Miguel I. Gómez & Timothy J. Richards & Koichi Yonezawa, 2024. "Retail Markups and Discount-Store Entry," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 64(1), pages 147-181, February.
    5. Pramono, Ari & Oppewal, Harmen, 2021. "Where to refuel: Modeling on-the-way choice of convenience outlet," Journal of Retailing and Consumer Services, Elsevier, vol. 61(C).
    6. Quan Zheng & Honggang Hu & Xiajun Amy Pan, 2023. "Implications of product substitutability in a distribution channel," Production and Operations Management, Production and Operations Management Society, vol. 32(6), pages 1636-1653, June.
    7. Richards, Timothy J. & Chenarides, Lauren & Çakir, Metin, 2022. "Dollar Store Entry," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322100, Agricultural and Applied Economics Association.
    8. MacDonald, James M. & Dong, Xiao & Fuglie, Keith O., 2023. "Concentration and Competition in U.S. Agribusiness," Economic Information Bulletin 337566, United States Department of Agriculture, Economic Research Service.
    9. Cambra-Fierro, Jesús & Gao, Lily (Xuehui) & Melero-Polo, Iguácel, 2021. "The power of social influence and customer–firm interactions in predicting non-transactional behaviors, immediate customer profitability, and long-term customer value," Journal of Business Research, Elsevier, vol. 125(C), pages 103-119.
    10. Rabinovich, Elliot & Chenarides, Lauren & Richards, Timothy J., 2024. "Inventory Competition and the Cost of a Stockout," 2024 Annual Meeting, July 28-30, New Orleans, LA 343649, Agricultural and Applied Economics Association.
    11. Li, Jiaqi, 2023. "Predicting the demand for central bank digital currency: A structural analysis with survey data," Journal of Monetary Economics, Elsevier, vol. 134(C), pages 73-85.
    12. Wei Zhou & Zidong Wang, 2020. "Competing for Search Traffic in Query Markets: Entry Strategy, Platform Design, and Entrepreneurship," Working Papers 20-12, NET Institute.
    13. Lopez, Rigoberto A. & Mohapatra, Debashrita & Steinbach, Sandro, 2024. "Mergers, store locations, and jobs: Evidence from the food retail industry," 2024 Annual Meeting, July 28-30, New Orleans, LA 343711, Agricultural and Applied Economics Association.
    14. Kapser, Sebastian & Abdelrahman, Mahmoud & Bernecker, Tobias, 2021. "Autonomous delivery vehicles to fight the spread of Covid-19 – How do men and women differ in their acceptance?," Transportation Research Part A: Policy and Practice, Elsevier, vol. 148(C), pages 183-198.
    15. Ackermann, Jeff, 2024. "The effects of franchising on stores, competitors, and consumers," International Journal of Industrial Organization, Elsevier, vol. 93(C).
    16. Yufeng Huang & Bart J. Bronnenberg, 2023. "Consumer Transportation Costs and the Value of E-Commerce: Evidence from the Dutch Apparel Industry," Marketing Science, INFORMS, vol. 42(5), pages 984-1003, September.
    17. Gauri, Dinesh K. & Jindal, Rupinder P. & Ratchford, Brian & Fox, Edward & Bhatnagar, Amit & Pandey, Aashish & Navallo, Jonathan R. & Fogarty, John & Carr, Stephen & Howerton, Eric, 2021. "Evolution of retail formats: Past, present, and future," Journal of Retailing, Elsevier, vol. 97(1), pages 42-61.
    18. Paul S. Koh, 2024. "Merger Analysis with Latent Price," Papers 2404.07684, arXiv.org, revised Feb 2025.

    More about this item

    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:bla:randje:v:51:y:2020:i:1:p:189-232. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/randdus.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.