Data Aggregation and Vertical Price Transmission: An Experiment with German Food Prices
AbstractThe impact of cross sectional aggregation over individual retail stores on the estimation and testing of vertical price transmission between the wholesale and retail levels is investigated using a unique data set of individual retail prices in Germany. Systematic differences between the results of estimations using aggregated data on the one hand, and disaggregated data on the other, are discussed theoretically and confirmed empirically. The results suggest that estimation with aggregated data generates misleading conclusions about price transmission behavior at the level of the individual units (i.e. retail stores) that underlie these aggregates.
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Bibliographic InfoPaper provided by International Association of Agricultural Economists in its series 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia with number 25291.
Date of creation: 2006
Date of revision:
Aggregation; Vertical Price Transmission; Food Prices; Germany; Demand and Price Analysis; Marketing; L11; D40;
Find related papers by JEL classification:
- L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
- D40 - Microeconomics - - Market Structure and Pricing - - - General
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