Abstract
Metropolitan areas with a significant presence of warehouse stores had lower retail food price increases during 1977 to 1992 than did areas with no warehouse stores. The negative impact occurred largely during the first half of the 15-year period. Strategic learning appears to have led to a different response from incumbent supermarkets during 1985–1992. Change in prices was positively related to change in concentration and negatively related to entry.
Similar content being viewed by others
References
Anderson, Keith (1990) 'A Review of Structure-Performance Studies in Grocery Retailing', Bureau of Economics, Federal Trade Commission, Washington D.C., June.
Cotterill, Ronald W. (1983) 'The Food Retailing Industry in Arkansas: A Study of Price and Service Levels', Unpublished report submitted to the Honorable Steve Clark, Attorney General, State of Arkansas, January 10, 1983.
Cotterill, Ronald (1986) 'Market Power in the Retail Food Industry: Evidence from Vermont', Review of Economics and Statistics, 68, 379-86.
Cotterill, Ronald, and L. Haller (1992) 'Barrier and Queue Effects: A Study of Leading U. S. Supermarket Chain Entry Patterns', Journal of Industrial Economics, 40, 427-440.
Gilbert, Les (1990) 'Smaller Format Seen for U.S. Hypermarkets', Supermarket News, June 25, p. 1.
Grocer's Spotlight (1985) 'Warehouse Stores — Format of the 80s', August 1, p. 33.
Food Institute Report (1994) 'Store Format Growth Trends', June 20, p. 5.
Hall, Lana, Schmitz, A., and Cothern, J. (1979) 'Beef Wholesale-Retail Marketing Margins and Concentration', Economica 46, 295-300.
Harp, Harry (1979) 'Labor Costs in Food Marketing', National Food Review, 8, 12-14.
Kelton, Christina M. L. (1982) 'The Effect of Market Structure on Price Change for Food Manufacturing Product Classes', Working Paper 60. Madison, WI: NC 117.
Kelton, Christina M. L., and W. Weiss (1989) 'Change in Concentration, Change in Cost, Change in Demand, and Change in Price', in Leonard Weiss, ed., Concentration and Price. Cambridge, MA: MIT Press.
Lamm, McFall (1981) 'Prices and Concentration in the Food Retailing Industry', Journal of Industrial Economics, 30, 67-78.
Lamm, R. McFall (1982) 'Unionism and Prices in the Food Retailing Industry', Journal of Labor Research, 3, 69-79.
Lamm, R. McFall, and Paul C. Westcott (1981) 'The Effects of Changing Input Costs on Food Prices', American Journal of Agricultural Economics, 63, 187-196.
Marion, Bruce W. (1984) 'Strategic Groups, Entry Barriers and Competitive Behavior in Grocery Retailing', Working Paper 81. Madison, WI: NC 117.
Marion, Bruce W., Willard F. Mueller, R. W. Cotterill, F. E. Geithman, and J. R. Schmelzer (1979) The Food Retailing Industry: Market Structure, Profits and Prices. New York: Praeger.
Metro Market Studies (various years). 'Grocery Distribution Analysis and Guide', Tucson, AZ.
Meyer, Peter J. (1983) 'Concentration and Performance in Local Retail Markets', in John Craven, ed., Industrial Organization, Antitrust, and Public Policy. Boston: Kluwer-Nijhoff Publishers.
Mueller, Willard F. (1984) 'Alleged Predatory Conduct in Food Retailing', Working Paper 78. Madison, WI: NC117.
Mueller, W. F. and Thomas W. Paterson (1986) 'Effectiveness of State Sales-Below-Cost Laws: Evidence from the Grocery Trade', Journal of Retailing, 62, 166-185.
Porter, Michael (1979) 'The Structure within Industries and Companies' Performance', Review of Economics and Statistics, 61, 214-227.
Progressive Grocer (1972) 'What Makes Warehouse Markets Go', August, p. 61.
Progressive Grocer (1985) 'Composite Chain Report', May, p. 96.
Progressive Grocer (1990) '57th Annual Report of the Grocery Industry, 1989', April.
Supermarket News (1983) 'Store Opening Puts Lucky in Super Warehouse Field', December 12, p. 1.
Supermarket News (1984) 'Cub Foods Out Front in Green Bay Market', January 9, p. 1, 21.
Supermarket News (1985) 'Town and Country Opens Cub to Stem Competition', November 11, p. 8A.
Supermarket News (1986) 'Says Big Depot Stores Are Losing Their Advantage', April 14, p. 1, 22.
Swisher, Kara (1990) 'Survey Reports Prices Not Uniform at Giants', Washington Post, Business Section, p. 1, May 30.
United States Department of Labor, Bureau of Labor Statistics (1984) BLS Handbook of Methods, Volume II, The Consumer Price Index. Washington, D.C.: GPO.
Weiss, Leonard, ed. (1989) Concentration and Price. Cambridge, MA: MIT Press.
Author information
Authors and Affiliations
Rights and permissions
About this article
Cite this article
Marion, B.W. Competition in Grocery Retailing: The Impact of a New Strategic Group on BLS Price Increases. Review of Industrial Organization 13, 381–399 (1998). https://doi.org/10.1023/A:1007748610511
Issue Date:
DOI: https://doi.org/10.1023/A:1007748610511