Price Dispersion and Competition with Differentiated Sellers

25 Pages Posted: 12 Nov 2008

See all articles by Matthew S. Lewis

Matthew S. Lewis

Clemson University - John E. Walker Department of Economics

Abstract

I measure price dispersion among differentiated retail gasoline sellers and study the relationship between dispersion and the local competitive environment. Significant price dispersion exists even after controlling for differences in station characteristics, and price differences between sellers change frequently. The extent of price dispersion is related to the density of local competition, but this relationship varies significantly depending on the type of seller and the composition of its competitors. These findings are consistent with interactions between seller and consumer heterogeneity that are not well understood in the existing price dispersion literature.

Suggested Citation

Lewis, Matthew S., Price Dispersion and Competition with Differentiated Sellers. The Journal of Industrial Economics, Vol. 56, Issue 3, pp. 654-678, September 2008, Available at SSRN: https://ssrn.com/abstract=1299268 or http://dx.doi.org/10.1111/j.1467-6451.2008.00348.x

Matthew S. Lewis (Contact Author)

Clemson University - John E. Walker Department of Economics ( email )

Clemson, SC 29634
United States

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