Spatial frictions in consumption and retail competition

Kluser, Frédéric; Seidel, Tobias; v. Ehrlich, Maximilian (September 2022). Spatial frictions in consumption and retail competition (CRED Research Paper 40). Bern: CRED - Center for Regional Economic Development

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In this paper, we empirically quantify spatial consumption frictions and the degree
of local retail competition. We exploit a unique data set including 1.5 billion daily
transactions in combination with detailed characteristics of more than 3 million
households. Our estimates are based on a quasi-experimental approach to estimate
the causal effect of store openings. We find that a same-chain store opening in the
proximity of households' residences reduces their expenditures at incumbent stores
by 30% in the first month. Smaller effects for competitors suggest imperfect
substitutability between retail chains. Exploiting more than 350 openings, we
identify causal consumption gravity functions, which allow us to quantify spatial
consumption areas. We document significant heterogeneities across regions and
socio-demographic groups, indicating substantial inequalities in consumption
access.

Item Type:

Working Paper

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Economics
03 Faculty of Business, Economics and Social Sciences > Department of Economics > Institute of Economics > Economic Policy and Regional Economics
03 Faculty of Business, Economics and Social Sciences > Department of Economics > Institute of Economics
11 Centers of Competence > Center for Regional Economic Development (CRED)

UniBE Contributor:

Kluser, Frédéric, v. Ehrlich, Maximilian

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

Series:

CRED Research Paper

Publisher:

CRED - Center for Regional Economic Development

Language:

English

Submitter:

Melanie Moser

Date Deposited:

11 Oct 2022 16:43

Last Modified:

05 Dec 2022 16:26

JEL Classification:

R1, R2, L14

BORIS DOI:

10.48350/173664

URI:

https://boris.unibe.ch/id/eprint/173664

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