Antitrust & Competition Policy Blog

Editor: D. Daniel Sokol
University of Florida
Levin College of Law

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Tuesday, October 6, 2009

Price and promotion effects of supermarket mergers

Posted by D. Daniel Sokol

David E. Davis (Department of Economics, South Dakota State University) provides his thoughts on Price and promotion effects of supermarket mergers.

ABSTRACT: I use a unique data set of retail food prices to analyze mergers between supermarket chains. The data allow for an examination of the effects of mergers on prices, the frequency of promotions, and the depth of promotions. I find that increases in a chain’s share of the total US food sales are associated with price decreases, suggesting that supermarkets enjoy economies of scale and/or benefit from an improved bargaining position relative to their suppliers after a merger. I also find that mergers are associated with decreases in the frequency and depth of price-promotions.

http://lawprofessors.typepad.com/antitrustprof_blog/2009/10/price-and-promotion-effects-of-supermarket-mergers.html

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Comments

interesting topic

Posted by: rehab | Jul 13, 2011 12:03:45 AM

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