Market Power, Brand Characteristics and Demand for Retail Grocery Products
AbstractThis paper examines the effects of market power and product differentiation on demand for grocery products in Australia over the period 2002 to 2005. We construct a model of the relationship between demand, market power and brand characteristics and then estimate the model using monthly data on price, quantity and volume sold for a bundle of 92 brands in 12 product categories from major supermarket stores across Australia. We also use data on the characteristics of each brand such as whether the product is environment-friendly, is a “private label”, or is made from recyclable materials. Our results suggest that firms are able to affect their demand curves through both product differentiation strategies and through market power.
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Bibliographic InfoPaper provided by Melbourne Institute of Applied Economic and Social Research, The University of Melbourne in its series Melbourne Institute Working Paper Series with number wp2006n05.
Length: 18 pages
Date of creation: Feb 2006
Date of revision:
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Postal: Melbourne Institute of Applied Economic and Social Research, The University of Melbourne, Victoria 3010 Australia
Phone: +61 3 8344 2100
Fax: +61 3 8344 2111
Web page: http://www.melbourneinstitute.com/
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This paper has been announced in the following NEP Reports:
- NEP-AGR-2006-02-26 (Agricultural Economics)
- NEP-ALL-2006-02-26 (All new papers)
- NEP-COM-2006-02-26 (Industrial Competition)
- NEP-IND-2006-02-26 (Industrial Organization)
- NEP-MIC-2006-02-26 (Microeconomics)
- NEP-MKT-2006-02-26 (Marketing)
- NEP-TID-2006-02-26 (Technology & Industrial Dynamics)
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