Geographic price dispersion in retail markets: Evidence from micro-data
- Authors
- Lee, Inkoo
- Issue Date
- Dec-2010
- Publisher
- LOUISIANA STATE UNIV PR
- Keywords
- Price dispersion; Law of One Price; Non-traded input; Tradability
- Citation
- JOURNAL OF MACROECONOMICS, v.32, no.4, pp.1169 - 1177
- Journal Title
- JOURNAL OF MACROECONOMICS
- Volume
- 32
- Number
- 4
- Start Page
- 1169
- End Page
- 1177
- URI
- http://scholarworks.bwise.kr/ssu/handle/2018.sw.ssu/14627
- DOI
- 10.1016/j.jmacro.2010.06.007
- ISSN
- 0164-0704
- Abstract
- Using an extensive micro-price data of 266 retail goods and services across US, EU and OECD cities between 1990 and 2005, we study characteristics of geographic dispersion of deviations from the Law of One Price. We find that the magnitude of price dispersion is a function of the characteristics of both the type of good and set of locations under examination. Higher share of non-traded inputs and lower tradability of goods are both found to contribute to geographic price dispersion, with the former typically dominating in explanatory power. The role of tradability of good in accounting for the price dispersion is more significant as we move beyond an economic geography, while non-traded input level matters relatively more if we move to the interior of this geography. Our evidence suggests that the models of real exchange rates should incorporate the classical distinction between traded inputs and local inputs as well as a role for relative markups and traditional trade costs. (C) 2010 Elsevier Inc. All rights reserved.
- Files in This Item
- There are no files associated with this item.
- Appears in
Collections - College of Economics and International Commerce > Department of Global Commerce > 1. Journal Articles
![qrcode](https://api.qrserver.com/v1/create-qr-code/?size=55x55&data=https://scholarworks.bwise.kr/ssu/handle/2018.sw.ssu/14627)
Items in ScholarWorks are protected by copyright, with all rights reserved, unless otherwise indicated.