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An Alternative View of Pricing in Retail Food Markets
Author(s) -
Benson Bruce L.,
Faminow Merle D.
Publication year - 1985
Publication title -
american journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.949
H-Index - 111
eISSN - 1467-8276
pISSN - 0002-9092
DOI - 10.2307/1240682
Subject(s) - explanatory power , economics , food market , market power , microeconomics , empirical evidence , price formation , agriculture , marketing , business , ecology , philosophy , monopoly , epistemology , biology
The pricing mechanism of intracity retail food markets has received the attention of agricultural economists who are interested in the competitive nature of food price determination. Attention has focused on the information‐theory paradigm and potential impact of publically available comparative price reports. In this paper, a spatial economic model is developed to describe and analyze consumer choice, seller behavior, and price determination in retail food markets. Empirical evidence is then used to test hypotheses developed from the spatial model. It is concluded that the spatial model offers added explanatory power of observed food market responses to retail price reporting.