Food Retailers' Pricing and Marketing Strategies, with Implications for Producers

Lan Li, Richard J. Sexton, Tian Xia
2006 Agricultural and Resource Economics Review  
This paper examines grocery retailers' ability to influence prices charged to consumers and paid to suppliers. We discuss how retailer market power manifests itself in terms of pricing and marketing strategies by setting forth and offering evidence in support of eight "stylized facts" of retailer pricing and brand decisions. We argue that little, if any, of this behavior can be explained by a model of a competitive, price-taking retailer, but that most of the indicated behavior was also
more » ... or was also inconsistent with traditional models of market power. Finally, we discuss the impacts of aspects of this retailer behavior on the upstream farm sector.
doi:10.1017/s1068280500006687 fatcat:yrd5vqrjbfcddpr6cntkr2nr3u