TY - JOUR
T1 - Price competition and private labels in the U.S. packaged salad market
AU - Meng, Xiao
AU - Jaenicke, Edward C.
N1 - Publisher Copyright:
© 2020 Informa UK Limited, trading as Taylor & Francis Group.
PY - 2021
Y1 - 2021
N2 - We study the price competition in the U.S. packaged salads market by testing two price competition hypotheses: Bertrand competition versus sequential pricing model. The former is standard for oligopoly pricing in the IO literature. The latter provides a formal mechanism for second-mover, price-undercutting behaviour by private-label brands, owned by mainstream supermarkets, that grew their market share dramatically in the second half of the 2000s. Applying Vuong and Gasmi (1991)’s test, we show that observed market prices and market shares fit best to Bertrand competition.
AB - We study the price competition in the U.S. packaged salads market by testing two price competition hypotheses: Bertrand competition versus sequential pricing model. The former is standard for oligopoly pricing in the IO literature. The latter provides a formal mechanism for second-mover, price-undercutting behaviour by private-label brands, owned by mainstream supermarkets, that grew their market share dramatically in the second half of the 2000s. Applying Vuong and Gasmi (1991)’s test, we show that observed market prices and market shares fit best to Bertrand competition.
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U2 - 10.1080/13504851.2020.1827132
DO - 10.1080/13504851.2020.1827132
M3 - Article
AN - SCOPUS:85092416744
SN - 1350-4851
VL - 28
SP - 1484
EP - 1490
JO - Applied Economics Letters
JF - Applied Economics Letters
IS - 17
ER -