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Heterogeneous impacts from a retail grocery acquisition: Do national and store brand prices respond differently?

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  • Metin Çakır
  • William G. Secor

Abstract

We investigate the extent to which a grocery retailer merger has different effects on the prices of national and store brands. Using retail scanner data, we retrospectively analyze a food retail acquisition in a large U.S. city. We focus on fluid milk and ready‐to‐eat (RTE) cereal categories, which represent a relatively homogenous and a relatively differentiated product category, respectively. We use a difference‐in‐difference estimation framework to obtain the causal effect of the acquisition on prices for the acquiring retailer. The primary finding is that the acquisition has heterogeneous price effects in the relatively differentiated RTE cereal category. The implications of results for consumers, food retailing, and merger analysis are discussed [EconLit citations: L11, L13, L22, L81].

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  • Metin Çakır & William G. Secor, 2018. "Heterogeneous impacts from a retail grocery acquisition: Do national and store brand prices respond differently?," Agribusiness, John Wiley & Sons, Ltd., vol. 34(3), pages 524-541, June.
    • Handle: RePEc:wly:agribz:v:34:y:2018:i:3:p:524-541
    DOI: 10.1002/agr.21545
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    Cited by:

    1. Metin Çakır & Joseph V. Balagtas & Abigail M. Okrent & Mariana Urbina‐Ramirez, 2021. "Effects of Package Size on Household Food Purchases," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(2), pages 781-801, June.
    2. Metin Çakır & Xiangwen Kong & Clare Cho & Alexander Stevens, 2020. "Rural Food Retailing and Independent Grocery Retailer Exits," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(5), pages 1352-1367, October.

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