Regulation and UK Retailing Productivity: Evidence from Micro Data
We use UK micro data to explore whether planning regulation reduced UK retailing productivity growth between 1997 and 2003. We document a shift to smaller shops, particularly within supermarket chains, following a regulatory change in 1996 which increased the costs of opening large stores. This might have caused a slowdown in productivity growth if firms (a) lose scale advantages, by moving to smaller stores and (b) lose scope advantages if existing organisational knowledge appropriate to larger stores is not perfectly substitutable with the organisational capital required to run smaller stores. Our micro data shows a relation, controlling for fixed effects, between chain-level TFP for multi-store chains and various measures of the size of the stores within the chain. Our results suggest the fall in within-chain shop sizes was associated with a lowering of chain TFP by about 0.4% pa, about 40% of the post-1995 slowdown in UK retail TFP growth. The foregone productivity works out at about £80,000 per small chain supermarket store.
|Date of creation:||Feb 2009|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
|Order Information:|| Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany|
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.:
- Bond, Stephen & Van Reenen, John, 2007. "Microeconometric Models of Investment and Employment," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 6, chapter 65 Elsevier.
- Steve Bond & Måns Söderbom, 2005.
"Adjustment costs and the identification of Cobb Douglas production functions,"
IFS Working Papers
W05/04, Institute for Fiscal Studies.
- Stephen Bond & Måns Söderbom, 2005. "Adjustment Costs and the Identification of Cobb Douglas Production Functions," Economics Papers 2005-W04, Economics Group, Nuffield College, University of Oxford.
- Victor Aguirregabiria & Pedro Mira & Hernan Roman, 2007.
"An Estimable Dynamic Model of Entry, Exit and Growth in Oligopoly Retail Markets,"
tecipa-275, University of Toronto, Department of Economics.
- Victor Aguirregabiria & Pedro Mira & Hernan Roman, 2007. "An Estimate Dynamic Model of Entry, Exit, and Growth in Oligopoly Retail Markets," American Economic Review, American Economic Association, vol. 97(2), pages 449-454, May.
- Raffaella Sadun, 2008.
"Does Planning Regulation Protect Independent Retailers?,"
CEP Discussion Papers
dp0888, Centre for Economic Performance, LSE.
- Raffaella Sadun, 2008. "Does planning regulation protect independent retailers?," LSE Research Online Documents on Economics 28503, London School of Economics and Political Science, LSE Library.
- Raffaella Sadun, 2014. "Does Planning Regulation Protect Independent Retailers?," NBER Working Papers 19797, National Bureau of Economic Research, Inc.
- Griffith, Rachel & Harmgart, Heike, 2008. "Supermarkets and Planning Regulation," CEPR Discussion Papers 6713, C.E.P.R. Discussion Papers.
- Emek Basker & Shawn Klimek & Pham Hoang Van, 2008.
"Supersize It: The Growth of Retail Chains and the Rise of the "Big Box" Retail Format,"
08-23r, Center for Economic Studies, U.S. Census Bureau, revised Sep 2011.
- Emek Basker & Shawn Klimek & Pham Hoang Van, 2008. "Supersize It: The Growth of Retail Chains and the Rise of the "Big Box" Retail Format," Working Papers 0809, Department of Economics, University of Missouri, revised 30 Sep 2010.
- Rachel Griffith & Heike Harmgart, 2005. "Retail productivity," IFS Working Papers W05/07, Institute for Fiscal Studies.
- Ronald S. Jarmin & Shawn D. Klimek & Javier Miranda, 2009.
"The Role of Retail Chains: National, Regional and Industry Results,"
in: Producer Dynamics: New Evidence from Micro Data, pages 237-262
National Bureau of Economic Research, Inc.
- Ronald Jarmin & Shawn Klimek & Javier Miranda, 2005. "The Role of Retail Chains: National, Regional, and Industry Results," Working Papers 05-30, Center for Economic Studies, U.S. Census Bureau.
When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp4028. 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: (Mark Fallak)
If references are entirely missing, you can add them using this form.