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Spatial Competition and Private Labels

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  • Richards, Timothy J.
  • Hamilton, Stephen F.
  • Patterson, Paul M.

Abstract

Private labels, also known as store brands, are an important component of competitive strategy among multi-product retailers, as they can increase retailers’ power over suppliers in the vertical channel or facilitate horizontal differentiation among retailers. This paper seeks to identify the relative importance of each role, conditional on the location of both private labels and national brands of ice cream in attribute space. We find that retailers’ share of the total margin (retail price less production cost) is higher for private labels than national brands when retailers choose to imitate national brands with their own offerings.

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Bibliographic Info

Article provided by Western Agricultural Economics Association in its journal Journal of Agricultural and Resource Economics.

Volume (Year): 35 (2010)
Issue (Month): 2 (August)
Pages:

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Handle: RePEc:ags:jlaare:93207

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Web page: http://waeaonline.org/
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Related research

Keywords: multi-product oligopoly; nested logit; private labels; retailing; spatial modeling; Industrial Organization;

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References

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Citations

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Cited by:
  1. Geoffrey Pofahl, 2009. "Merger Simulation in the Presence of Large Choice Sets and Consumer Stockpiling: The Case of the Bottled Juice Industry," Review of Industrial Organization, Springer, vol. 34(3), pages 245-266, May.
  2. Daniel Toro-Gonzalez & Jia Yan & R. Karina Gallardo & Jill J. McCluskey, 2013. "Estimation of Unobserved Attributes Using a Control Function Approach, Modeling the Demand for Mint Flavored Gum," Working Papers 2013-06, School of Economic Sciences, Washington State University.
  3. Ying, Xiongwei & Anders, Sven M., 2013. "Competition between Private Label and National Brand for Health-differentiated Food Product: A Canadian Retailing Case," 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. 151280, Agricultural and Applied Economics Association.

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