Department of Economics
Royal Holloway, University of London
Egham, Surrey, TW20 0EX
NBER Working Papers and Publications
|July 2008||E-commerce and the Market Structure of Retail Industries|
with Ali Hortacsu, Chad Syverson, Onsel Emre: w14166
While a fast-growing body of research has looked at how the advent and diffusion of e-commerce has affected prices, much less work has investigated e-commerce's impact on the number and type of producers operating in an industry. This paper theoretically and empirically takes up the question of which businesses most benefit and most suffer as consumers switch to purchasing products online. We specify a general industry model involving consumers with differing search costs buying products from heterogeneous-type producers. We interpret e-commerce as having reduced consumers' search costs. We show how such reductions reallocate market shares from an industry's low-type producers to its high-type businesses. We test the model using U.S. data for three industries in which e-commerce has arguab...
Published: Maris Goldmanis & Ali Hortaçsu & Chad Syverson & Önsel Emre, 2010.
"E-Commerce and the Market Structure of Retail Industries,"
Royal Economic Society, vol. 120(545), pages 651-682, 06.
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