Prices, Promotions, and Supermarket Mergers
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David E. Davis
Using a unique data set of transaction-level retail food sales, I find that food prices are negatively related to supermarket chains’ shares of total U.S. food sales. The negative relationship suggests that supermarket chains enjoy economies of scale or benefit from an improved post-merger bargaining position. In contrast, the regressions also show an increase in price after a merger, which is independent from changes in observable control variables. Subsequent fractional logit analysis suggests mergers are associated with decreases in the frequency and depth of price-promotions. These latter effects suggest supermarkets enjoy greater unilateral pricing power post-merger, perhaps due to improved brand identity.
©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston
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- Evaluating Reforms in Canadian Chicken Marketing Mechanisms Using a Linear-Quadratic Inventory Model
- Prices as Quality Signals: Evidence from the Wine Market
- The Effect of Proposition 2 on the Demand for Eggs in California
- An Empirical Analysis of the Determinants of Marketing Contract Structures for Corn and Soybeans
- Protected Designation of Origin Revisited
- The Influence of Local Selling Decisions on Organic Farm Incomes
- Optimal Farmer Choice of Marketing Channels in the Ethiopian Banana Market
- Prices, Promotions, and Supermarket Mergers
- The Impact of Perceived Prices on Willingness to Pay in Experimental Auctions
- The Demand for Seafood Eco-Labels in France
- Agricultural Trade Liberalization and Downstream Market Power: The Ad Valorem Case
Articles in the same Issue
- Article
- Evaluating Reforms in Canadian Chicken Marketing Mechanisms Using a Linear-Quadratic Inventory Model
- Prices as Quality Signals: Evidence from the Wine Market
- The Effect of Proposition 2 on the Demand for Eggs in California
- An Empirical Analysis of the Determinants of Marketing Contract Structures for Corn and Soybeans
- Protected Designation of Origin Revisited
- The Influence of Local Selling Decisions on Organic Farm Incomes
- Optimal Farmer Choice of Marketing Channels in the Ethiopian Banana Market
- Prices, Promotions, and Supermarket Mergers
- The Impact of Perceived Prices on Willingness to Pay in Experimental Auctions
- The Demand for Seafood Eco-Labels in France
- Agricultural Trade Liberalization and Downstream Market Power: The Ad Valorem Case
