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Competition and Oligopoly: A Case of UK Grocery Retailing


  • Kevin A. Lawler

    (European School of Management, UK)

  • Chih-Cheng Yang

    (University of Sunderland, UK)


In this paper we develop a model of Bertrand price competition with uncertainty as to the number of bidders. The auction models predict retail price dispersion as an observable feature of price discrimination. The implications of the auction models are tested using a logit model on primary data. Some simulations of the logit model further enrich and capture critical states of chain-store rivalry. The findings show that consumer characteristics define type of store choice and that an auction model of price competition with uncertainty is an appropriate way to model retail grocery competition.

Suggested Citation

  • Kevin A. Lawler & Chih-Cheng Yang, 2003. "Competition and Oligopoly: A Case of UK Grocery Retailing," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 1(2), pages 117-133.
  • Handle: RePEc:mgt:youmgt:v:1:y:2003:i:2:p:117-133

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    JEL classification:

    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection


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