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Tyre price dispersion across retail outlets in the UK
Author(s) -
Delgado Juan,
Waterson Michael
Publication year - 2003
Publication title -
the journal of industrial economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.93
H-Index - 77
eISSN - 1467-6451
pISSN - 0022-1821
DOI - 10.1111/j.0022-1821.2003.00212.x
Subject(s) - price dispersion , dispersion (optics) , business , product (mathematics) , commerce , industrial organization , marketing , econometrics , economics , mathematics , physics , geometry , optics
We investigate price dispersion in a retail market (car tyres) characterised by outlets each selling a range of products, some of which are manufactured by their owners. Consumers face substantial price dispersion across outlets even for very tightly defined products. We show that this price dispersion has systematic components relating to retailer‐manufacturer interactions. One specific result is that chains owned by manufacturers sell other manufacturers' tyres on average nearly 20% more expensively than do independent stores and over 11% more expensively than their own equivalent branded product.