Identifying and characterising price leadership in British supermarkets

Seaton, Jonathan S.; Waterson, Michael

doi:10.1016/j.ijindorg.2013.07.002

Cited by 40 publications

(31 citation statements)

References 21 publications

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“…It importantly extends previous work focused on pairwise interaction (e.g. Revoredo‐Giha and Renwick, ; Seaton and Waterson, ) or covering only the leading group of players (e.g. Chakraborty et al ., , ) to more general oligopolistic interaction amongst a wide set of competing firms.…”

Section: Review Of the Market Context And Related Literaturesupporting

confidence: 77%

“…In the academic literature, there are few papers focusing on the oligopolistic retailer competition in this market context. Seaton and Waterson () examine price leader‐follower patterns between Tesco and Asda for a range of packaged grocery items. Also, of more direct relevance to UK fresh produce retailing, Revoredo‐Giha and Renwick () observe a strengthening price interrelationship between Tesco and Sainsbury's, where price responses tend to be more strategic rather than straightforward direct competition.…”

Section: Review Of the Market Context And Related Literaturementioning

confidence: 99%

“…5 More substantive investigation and analyses highlight the incentives and potential for exercising market power against consumers' interests in the food retail sector (Competition Commission, 2000, 2008Smith, 2004Smith, , 2006. Focusing on particular products, Lloyd (2008), Revoredo-Giha and Renwick (2012) and Seaton and Waterson (2013) provide empirical evidence that price leadership and potential retail price coordination exists for UK beef, fresh produce and packaged groceries, respectively. However, in these pricing studies either the range of products or number of retailers covered tend to be limited and they span different time periods.…”

Section: Introductionmentioning

confidence: 99%

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Healthy Competition to Support Healthy Eating? An Investigation of Fruit and Vegetable Pricing in UK Supermarkets

Lan¹,

Dobson²

2017

J Agricultural Economics

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Governments and public health officials are urging the public to eat more fruits and vegetables to contribute to a healthy diet. However, there is concern that a lack of effective competition amongst supermarket retailers has resulted in inflated prices for these products which are deterring consumers from eating more of these healthy foods. We investigate this by examining the nature and extent of price competition for fresh fruits and vegetables amongst UK supermarket retailers, drawing on a panel of weekly retail and corresponding wholesale market prices over a seven‐year period. We find that the extent of supermarket competition varies across the products, being quite intense on some but much weaker on others, where the retailers do not fully respond to each other's prices and where the extent of their competitive interaction varies significantly with each other.

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Section: Review Of the Market Context And Related Literaturesupporting

confidence: 77%

Section: Review Of the Market Context And Related Literaturementioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Healthy Competition to Support Healthy Eating? An Investigation of Fruit and Vegetable Pricing in UK Supermarkets

Lan¹,

Dobson²

2017

J Agricultural Economics

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“…An additional factor which have affected both production and pricing decisions corresponds to the intense competition of the retail industry and particularly, of the supermarkets. Hollingsworth (2004) and Seaton and Waterson (2013) The individual price-cost margin estimates obtained by the cross-sectional Hall-…”

Section: Datamentioning

confidence: 99%

The Effects of Competition, Liquidity and Exports on Markups: Evidence from the UK Food and Beverages Sector

Amountzias

2017

J Ind Compet Trade

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This study investigates the pricing decisions of the UK food and beverages sector over 2007-2016. The markup model formulated by Hall (1988) and Roeger (1995) is employed where market power is expressed in terms of pricing decisions reflected by the difference between the price level and the marginal cost of production. The analysis is conducted under three steps: the first step estimates the markup ratio of the UK food and beverages sector over 2007-2016; the second step provides the price-cost margin of the 32 4 digit level NACE Rev.2 constituent industries over 2007-2016; and the last step tests the relationship between cross-sectional estimates of market power and the structural effects of concentration, liquidity and exports over 2009, 2011, 2015 and 2016. The results suggest the presence of imperfect competitive conduct in the sector, while the three structural effects appear to have a significant influence on the pricing decisions of the UK food and beverages industries.

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“…His results reveal a great deal of both within and across market price coordination and price leadership in the gasoline market. Seaton and Waterson (2013) propose a narrow definition of price leadership, occurring when a price change by the leader is followed in a short period by the other firm, which makes a price change of the same monetary amount on the same product. They test this definition of price leadership using data on prices for two key players in the British supermarkets industry.…”

Section: Introductionmentioning

confidence: 99%

Pricing strategies: who leads and who follows in the air and rail passenger markets in Italy

2018

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In this paper, we aim at empirically uncovering the existence of price leadership in the passenger transport market, whose oligopolistic structure facilitates the strategic interaction among companies, with price being one of the principal elements of competition. The strategic interaction is particularly favoured by the fact that prices are easily observable online by all competitors. The analysis focuses on selected Italian city-pair markets that differ from one another with respect to the degree of inter and intra-modal competition and to the characteristics of the transport services provided. We exploit this heterogeneity to study transport operators' strategic interactions in different competitive environments. We find evidence of the existence of price leadership, even though results differ across city-pair markets. In particular, it emerges that the incumbent operator, in either the air or the rail sector, always holds the role of leader.

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Identifying and characterising price leadership in British supermarkets

Cited by 40 publications

References 21 publications

Healthy Competition to Support Healthy Eating? An Investigation of Fruit and Vegetable Pricing in UK Supermarkets

Healthy Competition to Support Healthy Eating? An Investigation of Fruit and Vegetable Pricing in UK Supermarkets

The Effects of Competition, Liquidity and Exports on Markups: Evidence from the UK Food and Beverages Sector

Pricing strategies: who leads and who follows in the air and rail passenger markets in Italy

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