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Sources of Global Heterogeneity in Retail Spending


  • Nir Kshetri

    (The University of North Carolina at Greensboro, USA)

  • Ralf Bebenroth

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)


Economies worldwide vary greatly in terms of how much their consumers spend on various types of retail activities. The purpose of this paper is to examine how the regulatory characteristics as well as the natures and strategies of businesses are related to retail spending. We employed random effect time series cross sectional (TSCS) models linear in parameters for forty-eight economies using annual data for the 1999-2008 period. The results provided strong support that economic freedom, foreign direct investment (FDI) inflow and concentration of retail stores in an economy positively affect retail spending. We also found that tax and social security contributions as a proportion of the GDP is positively related to per capita grocery retail spending. A lack of data for a large number of economies, especially less developed ones potentially provides a limitation of this paper.

Suggested Citation

  • Nir Kshetri & Ralf Bebenroth, 2011. "Sources of Global Heterogeneity in Retail Spending," Discussion Paper Series DP2011-03, Research Institute for Economics & Business Administration, Kobe University.
  • Handle: RePEc:kob:dpaper:dp2011-03

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    References listed on IDEAS

    1. Blisard, Noel & Stewart, Hayden, 2007. "Food Spending in American Households, 2003-04," Economic Information Bulletin 59033, United States Department of Agriculture, Economic Research Service.
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    5. Cédric Durand, 2007. "Externalities from foreign direct investment in the Mexican retailing sector," Cambridge Journal of Economics, Oxford University Press, vol. 31(3), pages 393-411, May.
    6. John R. Hanson, 2003. "Proxies in the New Political Economy: Caveat Emptor," Economic Inquiry, Western Economic Association International, vol. 41(4), pages 639-646, October.
    7. Thomas Reardon & Spencer Henson & Julio Berdegué, 2007. "'Proactive fast-tracking' diffusion of supermarkets in developing countries: implications for market institutions and trade," Journal of Economic Geography, Oxford University Press, vol. 7(4), pages 399-431, July.
    8. Fuller, Wayne A. & Battese, George E., 1974. "Estimation of linear models with crossed-error structure," Journal of Econometrics, Elsevier, vol. 2(1), pages 67-78, May.
    9. Artis, Michael & Nixson, Frederick, 2007. "Economics of the European Union," OUP Catalogue, Oxford University Press, edition 4, number 9780199298969.
    10. Petter Næss, 2006. "Accessibility, Activity Participation and Location of Activities: Exploring the Links between Residential Location and Travel Behaviour," Urban Studies, Urban Studies Journal Limited, vol. 43(3), pages 627-652, March.
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    More about this item


    Retail spending; FDI; Economic freedom; Time series cross sectional (TSCS) models;

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