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The Impact of Retail Mergers on Food Prices: Evidence from France

Author

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  • Marie-Laure Allain

    (Department of Economics, Ecole Polytechnique - X - École polytechnique - CNRS - Centre National de la Recherche Scientifique, CREST - Centre de Recherche en Économie et Statistique - ENSAE ParisTech - École Nationale de la Statistique et de l'Administration Économique)

  • Claire Chambolle

    (Department of Economics, Ecole Polytechnique - X - École polytechnique - CNRS - Centre National de la Recherche Scientifique, INRA - INRA - Institut National de la Recherche Agronomique)

  • Stéphane Turolla

    (INRA - UMR 1302)

  • Sofia Villas-Boas

    (University of California [Berkeley])

Abstract

This paper analyzes the impact of a merger in the French retail sector on food prices, using a consumer panel data. We perform a di fference-in-diff erences analysis by comparing price changes in stores for which the local market structure is aff ected by the merger to unaff ected stores. In addition, we empirically investigate economic forces behind the observed price changes. On average, we fi nd that the merger signifi cantly raised competitors' prices contemporaneously with merging firms' price increases. Further, we show that competitor prices increase more in local markets that experience larger structural changes in concentration and chain diff erentiation.

Suggested Citation

  • Marie-Laure Allain & Claire Chambolle & Stéphane Turolla & Sofia Villas-Boas, 2013. "The Impact of Retail Mergers on Food Prices: Evidence from France," Working Papers hal-00920460, HAL.
    • Handle: RePEc:hal:wpaper:hal-00920460
    Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-00920460
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    References listed on IDEAS

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    Cited by:

    1. Luca Aguzzoni & Elena Argentesi & Lorenzo Ciari & Tomaso Duso & Massimo Tognoni, 2016. "Ex post Merger Evaluation in the U.K. Retail Market for Books," Journal of Industrial Economics, Wiley Blackwell, vol. 64(1), pages 170-200, March.
    2. Rickert, Dennis & Schain, Jan Philip & Stiebale, Joel, 2018. "Local market structure and consumer prices: Evidence from a retail merger," DICE Discussion Papers 280, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    3. Brian Adams & Kevin R. Williams, 2017. "Zone Pricing in Retail Oligopoly," Cowles Foundation Discussion Papers 2079R, Cowles Foundation for Research in Economics, Yale University, revised Apr 2017.
    4. Orley Ashenfelter & Daniel Hosken & Matthew Weinberg, 2014. "Did Robert Bork Understate the Competitive Impact of Mergers? Evidence from Consummated Mergers," Journal of Law and Economics, University of Chicago Press, vol. 57(S3), pages 67-100.
    5. Secor, William & Çakır, Metin, 2016. "Impacts from a retail grocery acquisition: Do national and store brand prices respond differently?," 2016 Annual Meeting, July 31-August 2, 2016, Boston, Massachusetts 235945, Agricultural and Applied Economics Association.
    6. Argentesi, Elena & Buccirossi, Paolo & Cervone, Roberto & Duso, Tomaso & Marrazzo, Alessia, 2016. "The effect of retail mergers on prices and variety: An ex-post evaluation," DICE Discussion Papers 225, University of Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    7. Cakir, Metin & Balagtas, Joseph Valdes & Okrent, Abigail M., 2014. "The impact of package size on consumption," 2014 International Congress, August 26-29, 2014, Ljubljana, Slovenia 182776, European Association of Agricultural Economists.

    More about this item

    Keywords

    Diff erence-in-diff erences; Ex-post merger evaluation; Retail grocery sector; Diff erence-in-diff erences.;

    JEL classification:

    • K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco

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