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Duopoly Competition in Supermarket Industry: The Case of Seattle-Tacoma Milk Market


  • Chidmi, Benaissa
  • Murova, Olga I.


The Seattle-Tacoma consumers have been paying higher prices for fresh milk than consumers in other Western states of United States. For instance, the retail price for whole milk averaged $3.27/gallon during the period of April 1999- April 2003 in Seattle-Tacoma, while it did not go beyond $2.86/gallon in most of the large metropolitan areas in Western U.S, during the same period (Carman and Sexton, 2006). In addition, retail prices in Seattle-Tacoma do not respond similarly to farm price increases and decreases. Supermarkets are prompt to pass on to consumers any increase in farm price, while they do not pass or lag behind when farm price decreases. The present study attempts to analyze the pricing conduct of supermarket chains in a duopoly setting using a structural model of consumers and firms behavior. In this paper, we examine the pricing conduct of two supermarket chains using retail supermarket-level data on sales and prices from Seattle-Tacoma market area.

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  • Chidmi, Benaissa & Murova, Olga I., 2008. "Duopoly Competition in Supermarket Industry: The Case of Seattle-Tacoma Milk Market," 2008 Annual Meeting, February 2-6, 2008, Dallas, Texas 6740, Southern Agricultural Economics Association.
  • Handle: RePEc:ags:saeaed:6740

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    1. Toole, Andrew A. & Czarnitzki, Dirk, 2007. "Biomedical academic entrepreneurship through the SBIR program," Journal of Economic Behavior & Organization, Elsevier, vol. 63(4), pages 716-738, August.
    2. Goldfarb, Brent & Henrekson, Magnus, 2003. "Bottom-up versus top-down policies towards the commercialization of university intellectual property," Research Policy, Elsevier, vol. 32(4), pages 639-658, April.
    3. Jerry Thursby & Marie Thursby, 2005. "Gender Patterns of Research and Licensing Activity of Science and Engineering Faculty," The Journal of Technology Transfer, Springer, vol. 30(4), pages 343-353, October.
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    Agribusiness; Demand and Price Analysis;

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