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Does Organisational Form Drive Competition? Evidence from Coffee Retailing

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  • Brian Adams
  • Joshua Gans
  • Richard Hayes
  • Ryan Lampe

Abstract

Independent and chain coffee shops offer similar products, but differ in their organisational form and branding. We examine the entry and exit patterns of 4,768 coffee retailers in Melbourne between 1991 and 2010. Panel logit regressions indicate that chain stores have no discernible effect on the exit or entry decisions of independent stores. However, chains and independents do increase the probability of exit for neighbouring stores of their own type. These findings imply that independents and chains operate almost as though they are in separate markets.

Suggested Citation

  • Brian Adams & Joshua Gans & Richard Hayes & Ryan Lampe, 2018. "Does Organisational Form Drive Competition? Evidence from Coffee Retailing," The Economic Record, The Economic Society of Australia, vol. 94(305), pages 155-167, June.
    • Handle: RePEc:bla:ecorec:v:94:y:2018:i:305:p:155-167
    DOI: 10.1111/1475-4932.12397
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    1. Shih‐Chuan Lin & Yoo Ri Kim, 2021. "Heterogeneous effects of hotel ownership structure changes on localized market competition using multilevel mixed‐effect analyses," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(4), pages 808-820, June.

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    More about this item

    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality

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