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Retail sector concentration and price dynamics in the euro area: a regional analysis

Author

Listed:
  • Emanuela Ciapanna

    (Banca d'Italia)

  • Concetta Rondinelli

    (Banca d'Italia)

Abstract

We conduct a regional analysis of the relationship between market concentration and price dynamics in the grocery retail sector, focusing on a sample of five categories of goods belonging to the 12 COICOP aggregation and on a panel of countries that includes Germany, Spain, Finland, Italy, Austria and Portugal. Using a unique census-type dataset on retailers, we construct Herfindahl-Hirschman indices of concentration at the buying group, parent company and individual shop level for a sample of 118,540 large grocery stores and we study the association between these measures and regional price changes. Our results point to a positive association between retail market concentration and price growth in food and beverages, alcohol and tobacco and miscellaneous goods in the time span 2003-2010 at the buying, parental group and store level for the pooled sample of countries. The relation reverses sign for clothing and footwear and household equipment. This evidence is robust to different specifications of concentration indices.

Suggested Citation

  • Emanuela Ciapanna & Concetta Rondinelli, 2011. "Retail sector concentration and price dynamics in the euro area: a regional analysis," Questioni di Economia e Finanza (Occasional Papers) 107, Bank of Italy, Economic Research and International Relations Area.
    • Handle: RePEc:bdi:opques:qef_107_11
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    File URL: https://www.bancaditalia.it/pubblicazioni/qef/2011-0107/QEF_107.pdf
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    References listed on IDEAS

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    Cited by:

    1. Eliana Viviano & Luciana Aimone Gigio & Emanuela Ciapanna & Daniele Coin & Fabrizio Colonna & Federica Lagna & Raffaele Santioni, 2012. "The retail trade sector and the food industry in Italy," Questioni di Economia e Finanza (Occasional Papers) 119, Bank of Italy, Economic Research and International Relations Area.
    2. Castellari Elena & Bonanno Alessandro & Sckokai Paolo, 2019. "Food Retail Liberalization, Food Retail Structure and Food Prices: The Italian Case," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 17(2), pages 1-11, November.
    3. Liesbeth Colen & Zohra Bouamra-Mechemache & Victoria Daskalova & Kjersti Nes, 2020. "Retail alliances in the agricultural and food supply chain," JRC Research Reports JRC120271, Joint Research Centre.
    4. Ciapanna, Emanuela & Rondinelli, Concetta, 2014. "Retail market structure and consumer prices in the euro area," Working Paper Series 1744, European Central Bank.

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    More about this item

    Keywords

    market concentration; price dynamics; buying group; parent company; regional Herfindahl-Hirschman indices.;
    All these keywords.

    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • L8 - Industrial Organization - - Industry Studies: Services
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation

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