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Supermarkets and Planning Regulation

Rachel Griffith

Institute for Fiscal Studies (IFS); University of Manchester; Centre for Economic Policy Research (CEPR)

February 2008

CEPR Discussion Paper No. DP6713

We are interested in evaluating the impact of restrictive planning regulation on entry into the UK grocery retail industry. We estimate a model similar to Bresnahan and Reiss (1991) where we allow for multiple store formats. We find that more restrictive planning regulation reduces the number of large format supermarkets in equilibrium. However, the impact is overstated if variation in demographic characteristics across markets is not also controlled for. Our estimates suggest that restrictive planning regulation leads to a loss to consumers of up to £10m per annum. This cost must be offset against any benefits that arise, e.g. due to reduced congestion.

Number of Pages in PDF File: 42

Keywords: entry, land use regulation, retail

JEL Classification: L11, L52, L81

Date posted: June 10, 2008  

Suggested Citation

Griffith, Rachel, Supermarkets and Planning Regulation (February 2008). , Vol. , pp. -, 2008. Available at SSRN: https://ssrn.com/abstract=1141619

Contact Information

Rachel Griffith (Contact Author)
Institute for Fiscal Studies (IFS) ( email )
7 Ridgmount Street
London WC1E 7AE
United Kingdom
+44 20 7291 4800 (Phone)
+44 20 7323 4780 (Fax)
University of Manchester ( email )
Arthur Lewis Building
Oxford Road
Manchester, M13 9PL
United Kingdom
HOME PAGE: http://www.ifs.org.uk/people/profile?id=37
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
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