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Hypermarket Competition and the Diffusion of Retail Checkout Barcode Scanning

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  • Beck, Jonathan
  • Grajek, Michal
  • Wey, Christian

Abstract

This paper presents a set of panel data to study the diffusion of retail checkout barcode scanning in ten European countries over the period 1981-1996. Estimates from a standard diffusion model suggest that countries differ most in the long-run diffusion level of barcode scanning and less in timing or diffusion speed. We present evidence that the emergence of hypermarkets raises competitive intensity and use hypermarket data, among other variables, in a pooled estimation. Results suggest that hypermarket competition reduces the long-run adoption level in retailing. In particular, the emergence of hypermarkets seems to deepen retail segmentation by inducing potential adopters (e.g. supermarkets) to exit the market and/or by discouraging adoption by other retail formats. Consistent with expectations, scale and income effects spur IT diffusion and there is a classic substitution effect: when wages rise, diffusion of a labour-saving technology such as barcode-scanning is more intense. We do not find a significant impact of employment protection legislation.

Suggested Citation

  • Beck, Jonathan & Grajek, Michal & Wey, Christian, 2005. "Hypermarket Competition and the Diffusion of Retail Checkout Barcode Scanning," CEPR Discussion Papers 5386, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:5386
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    Cited by:

    1. Grajek, Michal & Kretschmer, Tobias, 2009. "Usage and diffusion of cellular telephony, 1998-2004," International Journal of Industrial Organization, Elsevier, vol. 27(2), pages 238-249, March.
    2. Jonathan Beck & Michal Grajek & Christian Wey, 2011. "Estimating level effects in diffusion of a new technology: barcode scanning at the checkout counter," Applied Economics, Taylor & Francis Journals, vol. 43(14), pages 1737-1748.
    3. Cansu Ünver, 2015. "Does Broadband Facilitate Immigration Flows? A Non-Linear Instrumental Variable Approach," Ekonomi-tek - International Economics Journal, Turkish Economic Association, vol. 4(1), pages 69-104, January.
    4. Cansu Unver, 2015. "Does Broadband Facilitate Immigration Flows?," Discussion Papers 15-01, Department of Economics, University of Birmingham.

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    More about this item

    Keywords

    hypermarkets; IT diffusion; retail competition;
    All these keywords.

    JEL classification:

    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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