Market Structure, Inflation, and Price Dispersion
AbstractIn this paper, we investigate the impact of market structure on the relationship between inflation and price dispersion. We first propose a new empirical model of the relationship between inflation and dispersion with firmer theoretical foundations, and then extend the basic model to incorporate the potential effects of market structure. We estimate the basic and market structure specifications using a unique micro-level data set from Istanbul, which consists of monthly price observations from three different store types: convenience stores, open-air markets, and supermarkets. Our empirical findings support almost all of the basic and market structure predictions.
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Bibliographic InfoPaper provided by University of Liverpool Management School in its series Research Papers with number 2003_03.
Length: 43 pages
Date of creation: 12 May 2003
Date of revision: 28 Apr 2004
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Postal: Management School University of Liverpool, Chatham Street, Liverpool, L69 7ZH, Great Britain
Phone: +44(0)151 795 3108
Fax: +44(0)151 795 3004
Web page: http://www.liv.ac.uk/management/
More information through EDIRC
inflation; market structure; menu cost models; micro panel data; price dispersion;
Other versions of this item:
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
- D40 - Microeconomics - - Market Structure and Pricing - - - General
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
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