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Deregulation of Shopping Hours: The Impact on Independent Retailers and Chain Stores

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  • Tobias Wenzel

Abstract

This paper studies shopping hour decisions by retail chains and independent competitors. We use a Salop-type model where retailers compete in prices and shopping hours. Our results depend significantly on efficiency differences between retail chain and independent retailer. If the efficiency difference is small, the independent retailer may choose longer shopping hours than the retail chain and may gain from deregulation at the expense of the retail chain. The opposite result emerges when the efficiency difference is large. Then, the retail chain may benefit whereas the independent retailer loses from deregulation.
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Suggested Citation

  • Tobias Wenzel, 2011. "Deregulation of Shopping Hours: The Impact on Independent Retailers and Chain Stores," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(1), pages 145-166, March.
  • Handle: RePEc:bla:scandj:v:113:y:2011:i:1:p:145-166 DOI: j.1467-9442.2010.01636.x
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    References listed on IDEAS

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    1. de Meza, David, 1984. "The Fourth Commandment: Is it Pareto Efficient?," Economic Journal, Royal Economic Society, vol. 94(374), pages 379-383, June.
    2. Esther Gal-Or & Anthony Dukes, 2006. "On the Profitability of Media Mergers," The Journal of Business, University of Chicago Press, vol. 79(2), pages 489-526, March.
    3. Eric Giraud-Héraud & Hakim Hammoudi & Mahdi Mokrane, 2003. "Multiproduct firm behaviour in a differentiated market," Canadian Journal of Economics, Canadian Economics Association, vol. 36(1), pages 41-61, February.
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    Citations

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    Cited by:

    1. Yamada, Mai, 2014. "Opening Hours and Quality Choices," MPRA Paper 56066, University Library of Munich, Germany.
    2. Clémence Christin, 2013. "Entry Deterrence Through Cooperative R&D Over-Investment," Recherches économiques de Louvain, De Boeck Université, pages 5-26.
    3. Tobias Wenzel, 2010. "Liberalization of Opening Hours with Free Entry," German Economic Review, Verein für Socialpolitik, vol. 11, pages 511-526, November.
    4. Pennerstorfer, Dieter & Weiss, Christoph, 2013. "Spatial clustering and market power: Evidence from the retail gasoline market," Regional Science and Urban Economics, Elsevier, vol. 43(4), pages 661-675.
    5. Senftleben-König, Charlotte, 2014. "Product Market Deregulation and Employment Outcomes: Evidence from the German Retail Sector," Annual Conference 2014 (Hamburg): Evidence-based Economic Policy 100539, Verein für Socialpolitik / German Economic Association.
    6. Charlotte Senftleben-König, 2014. "Product Market Deregulation and Employment Outcomes: Evidence from the German Retail Sector," SFB 649 Discussion Papers SFB649DP2014-013, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
    7. Heimeshoff, Ulrich & Klein, Gordon J., 2013. "Bargaining power and local heroes," DICE Discussion Papers 87, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    8. Haucap, Justus & Herr, Annika & Frank, Björn, 2011. "In vino veritas: Theory and evidence on social drinking," DICE Discussion Papers 37, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    9. repec:bla:ecinqu:v:55:y:2017:i:2:p:757-777 is not listed on IDEAS
    10. Stühmeier Torben & Wenzel Tobias, 2012. "Regulating Advertising in the Presence of Public Service Broadcasting," Review of Network Economics, De Gruyter, pages 1-23.
    11. Gu, Yiquan & Wenzel, Tobias, 2012. "Transparency, entry, and productivity," Economics Letters, Elsevier, vol. 115(1), pages 7-10.
    12. Bossler, Mario & Oberfichtner, Michael, 2014. "The employment effect of deregulating shopping hours: Evidence from German retailing," Discussion Papers 91, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
    13. Haucap Justus, 2013. "Braucht Deutschland einen Kapazitätsmarkt für eine sichere Stromversorgung?," Zeitschrift für Wirtschaftspolitik, De Gruyter, pages 257-269.
    14. Charlotte Senftleben-König, 2014. "Product Market Deregulation and Employment Outcomes: Evidence from the German Retail Sector," Working Papers 2014009, Berlin Doctoral Program in Economics and Management Science (BDPEMS).
    15. Vitor Miguel Ribeiro, 2014. "Establishing a link between behavior ecconomics and two-sided markets," FEP Working Papers 538, Universidade do Porto, Faculdade de Economia do Porto.
    16. Stühmeier Torben & Wenzel Tobias, 2012. "Regulating Advertising in the Presence of Public Service Broadcasting," Review of Network Economics, De Gruyter, pages 1-23.
    17. Bossler, Mario & Oberfichtner, Michael, 2014. "The employment effect of deregulating shopping hours: Evidence from German retailing," Discussion Papers 91, Friedrich-Alexander University Erlangen-Nuremberg, Chair of Labour and Regional Economics.

    More about this item

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce

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