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Hypermarket Competition and the Diffusion of Retail Checkout Barcode Scanning

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Author Info
Jonathan Beck
Michal Grajek
Christian Wey

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Abstract

This paper presents a set of panel data to study the diffusion of retail checkout barcode scanning in ten European countries over the period 1981-1996. Estimates from a standard diffusion model suggest that countries differ most in the long-run diffusion level of barcode scanning and less in timing or diffusion speed. We present evidence that the emergence of hypermarkets raises competitive intensity and use hypermarket data, among other variables, in a pooled estimation. Results suggest that hypermarket competition reduces long-run adoption of information technology (IT) in retailing. In particular, the emergence of hypermarkets seems to deepen retail segmentation by inducing potential adopters (e.g. supermarkets) to exit the market and/or by discouraging adoption by other retail formats. Consistent with expectations, scale and income effects spur IT diffusion and there is a classic substitution effect: when wages rise, diffusion of a labor-saving technology such as barcode scanning is more intense. We do not find a significant impact of employment protection legislation.

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Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 523.

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Length: 34 p.
Date of creation: 2005
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Handle: RePEc:diw:diwwpp:dp523

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Related research
Keywords: IT diffusion; Retail competition; Hypermarkets;

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Find related papers by JEL classification:
L5 - Industrial Organization - - Regulation and Industrial Policy
L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes

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References listed on IDEAS
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Michal Grajek & Tobias Kretschmer, 2006. "Usage and Diffusion of Cellular Telephony, 1998-2004," CIG Working Papers SP II 2006-20, Wissenschaftszentrum Berlin (WZB), Research Unit: Competition and Innovation (CIG). [Downloadable!]
    Other versions:
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