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Benjamin Eden, Maya Eden and Jonah Yuen
 
''INSIDE THE PRICE DISPERSION BOX: EVIDENCE FROM US SCANNER DATA''
 
 
To characterize the cross sectional price distribution of supermarket prices, we divide the stores in each good-week combination (UPC-week cell) into bins according to their price. For example, in the 3 bins division case we have a high price bin, a medium price bin and a low price bin. Our main findings are: (a) The variations over weeks in the (cross sectional) average price and quantity sold is lower for higher price bins; (b) Temporary sales contribute substantially to variations over weeks in the average price of the typical good; (c) The elasticity of the quantity sold by stores in the high price bin with respect to the quantity sold by stores in a low price bin (the quantity elasticity) is less than unity; (d) The elasticity of the quantity sold by stores in the high price bin with respect to the price in a low price bin (the cross price elasticity) is positive but less than the absolute value of the own price elasticity. More generally, we provide results about elasticities within UPC-week cells, variations over weeks within UPC and the role of temporary sales.
 
 
Keywords: Price Dispersion, Sequential Trade, Temporary Sales
JEL: D4 - Market Structure and Pricing: General
E3 - Prices, Business Fluctuations, and Cycles: General (includes Measurement and Data)
 
Manuscript Received : Aug 31 2016 Manuscript Accepted : Sep 21 2016

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