Price sensitivity within and across retail formats
Does the perceived pricing environment affect consumer reactions in food retail? Applying a synthetic demand system approach, we examine if customers of discount stores reveal different demand elasticities than those of conventional supermarkets. Based on a RollAMA dataset containing information on consumption in 12 2 different retail chains in Austria, we first analyze demand patterns when consumers only frequent either discounters or supermarkets, followed by an investigation of potential cross-foormat effects when both types of stores are visited. T Tests for significance of the differences in demand reactions evaluate their importance. Our empirical findings suggest that for the 3 categories of milk products under examination, price elasticities in discount stores are by tendency higher, despite uniform product characteristics. The hypothesis of equal cross-format price elasticities is mostly rejected, which particularly holds for the case of drinking milk.
|Date of creation:||2012|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.aieaa.org/|
More information through EDIRC
References listed on IDEAS
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.:
- Toshinobu Matsuda, 2005. "Differential Demand Systems: A Further Look at Barten's Synthesis," Southern Economic Journal, Southern Economic Association, vol. 71(3), pages 607-619, January.
- Emek Basker & Michael Noel, 2007.
"The Evolving Food Chain: Competitive Effects of Wal-Marts Entry into the Supermarket Industry,"
0712, Department of Economics, University of Missouri.
- Emek Basker & Michael Noel, 2009. "The Evolving Food Chain: Competitive Effects of Wal-Mart's Entry into the Supermarket Industry," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(4), pages 977-1009, December.
- Noel, Michael & Basker, Emek, 2007. "The Evolving Food Chain: Competitive Effects of Wal-Mart's Entry Into The Supermarket Industry," University of California at San Diego, Economics Working Paper Series qt4nq8d4sm, Department of Economics, UC San Diego.
- David Soberman, 2005. "Questioning Conventional Wisdom About Competition in Differentiated Markets," Quantitative Marketing and Economics, Springer, vol. 3(1), pages 41-70, January.
- Kathleen Cleeren & Frank Verboven & Marnik G. Dekimpe & Katrijn Gielens, 2010.
"Intra- and Interformat Competition Among Discounters and Supermarkets,"
INFORMS, vol. 29(3), pages 456-473, 05-06.
- Cleeren, Kathleen & Dekimpe, Marnik G. & Gielens, Katrijn & Verboven, Frank, 2008. "Intra- and Inter-Format Competition Among Discounters and Supermarkets," CEPR Discussion Papers 6964, C.E.P.R. Discussion Papers.
- Bouamra-Mechemache, Zohra & Réquillart, Vincent & Soregaroli, Claudio & Trévisiol, Audrey, 2007.
"Demand for Dairy Products in the EU,"
IDEI Working Papers
454, Institut d'Économie Industrielle (IDEI), Toulouse.
- Thilmany, Dawn D. & Grannis, Jennifer L. & Sparling, Edward, 2001. "Shopping For Meat: Empirical Demand Estimation For Natural Beef Across Store Choices," 2001 Annual Meeting, July 8-11, 2001, Logan, Utah 36157, Western Agricultural Economics Association.
- Bonanno, Alessandro & Lopez, Rigoberto, 2007.
"Competition Effects of Supermarket Services,"
149176, University of Connecticut, Food Marketing Policy Center.
- Alessandro Bonanno & Rigoberto A. Lopez, 2007. "Competition Effects of Supermarket Services," Food Marketing Policy Center Research Reports 094, University of Connecticut, Department of Agricultural and Resource Economics, Charles J. Zwick Center for Food and Resource Policy.
- Bonanno, Alessandro & Lopez, Rigoberto A., 2007. "Competition Effects of Supermarket Services," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon TN 9833, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Richard Tiffin & Matthieu Arnoult, 2010. "The demand for a healthy diet: estimating the almost ideal demand system with infrequency of purchase," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 37(4), pages 501-521, December.
- Bustos-Reyes, César Augusto & González-Benito, Óscar, 2008. "Store and store format loyalty measures based on budget allocation," Journal of Business Research, Elsevier, vol. 61(9), pages 1015-1025, September.
- McGuirk, Anya M. & Driscoll, Paul J. & Alwang, Jeffrey Roger & Huang, Huilin, 1995. "System Misspecification Testing And Structural Change In The Demand For Meats," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(01), July.
- Karsten Hansen & Vishal Singh, 2009. "Market Structure Across Retail Formats," Marketing Science, INFORMS, vol. 28(4), pages 656-673, 07-08.
- Maynard, Leigh J. & Veeramani, Venkat N., 2003.
"Price Sensitivities for U.S. Frozen Dairy Products,"
Journal of Agricultural and Applied Economics,
Southern Agricultural Economics Association, vol. 35(03), December.
- Maynard, Leigh J. & Narayanan, V. Venkat, 2002. "Price Sensitivities For U.S. Frozen Dairy Products," 2002 Annual meeting, July 28-31, Long Beach, CA 19781, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Okrent, Abigail M. & Alston, Julian M., 2011. "The Demand for Disaggregated Food-Away-from-Home Products," 2011 Annual Meeting, July 24-26, 2011, Pittsburgh, Pennsylvania 103625, Agricultural and Applied Economics Association.
- Moschini, GianCarlo, 1995. "Units of Measurement and the 'Stone Index' In Demand System Estimation," Staff General Research Papers 5058, Iowa State University, Department of Economics.
- Ting Zhu & Vishal Singh & Anthony J. Dukes, 2005. "Local Competition and Impact of Entry by a Dominant Retailer," CIE Discussion Papers 2005-05, University of Copenhagen. Department of Economics. Centre for Industrial Economics.
- Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June.
- Panle Jia, 2008. "What Happens When Wal-Mart Comes to Town: An Empirical Analysis of the Discount Retailing Industry," Econometrica, Econometric Society, vol. 76(6), pages 1263-1316, November.
- Jinghua Xie & Henry W. Kinnucan & Oystein Myrland, 2009. "Demand elasticities for farmed salmon in world trade," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 36(3), pages 425-445, September.
- Leibtag, Ephraim S. & Barker, Catherine & Dutko, Paula, 2010. "How Much Lower Are Prices at Discount Stores? An Examination of Retail Food Prices," Economic Research Report 96767, United States Department of Agriculture, Economic Research Service.
- Patrice Bertail & France Caillavet, 2008. "Fruit and Vegetable Consumption Patterns: A Segmentation Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 90(3), pages 827-842.
- Barten, Anton P, 1993. "Consumer Allocation Models: Choice of Functional Form," Empirical Economics, Springer, vol. 18(1), pages 129-58.
- Yuan, Yan & Capps, Oral, Jr. & Nayga, Rodolfo M., Jr., 2009. "Assessing the Demand for a Functional Food Product: Is There Cannibalization in the Orange Juice Category?," Agricultural and Resource Economics Review, Northeastern Agricultural and Resource Economics Association, vol. 38(2), October.
- James Eales & Catherine Durham & Cathy R. Wessells, 1997. "Generalized Models of Japanese Demand for Fish," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(4), pages 1153-1163.
- Venkatesh Shankar & Ruth N. Bolton, 2004. "An Empirical Analysis of Determinants of Retailer Pricing Strategy," Marketing Science, INFORMS, vol. 23(1), pages 28-49, May.
- Vishal P. Singh & Karsten T. Hansen & Robert C. Blattberg, 2006. "Market Entry and Consumer Behavior: An Investigation of a Wal-Mart Supercenter," Marketing Science, INFORMS, vol. 25(5), pages 457-476, September.
When requesting a correction, please mention this item's handle: RePEc:ags:aieacp:124108. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If references are entirely missing, you can add them using this form.