NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Shantanu Dutta

University of Southern California
Marshall School of Business
3670 Trousdale Parkway, ACC 306E
Los Angeles CA 90089-0443

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NBER Working Papers and Publications

January 2003What Can the Price Gap between Branded and Private-Label Products Tell Us about Markups?
with Robert B. Barsky, Mark Bergen, Daniel Levy
in Scanner Data and Price Indexes, Robert C. Feenstra and Matthew D. Shapiro, editors
August 2001What Can the Price Gap between Branded and Private Label Products Tell Us about Markups?
with Robert Barsky, Mark Bergen, Daniel Levy: w8426
In this paper we investigate the size of markups for nationally branded products sold in the U.S. retail grocery industry. Using scanner data from a large Midwestern supermarket chain, we compute several measures of upper and lower bounds on markup ratios for over 230 nationally branded products in 19 categories. Our method is based on the insight that retail and wholesale prices of private label products provide information on marginal costs that are also applicable to the appropriately matched nationally branded products. Under reasonable assumptions - the accuracy of which we consider in some detail - the wholesale price of a private label product is an upper bound for the marginal manufacturing cost of its nationally branded equivalent, while the retailer's margin on the national brand...

Published: What Can the Price Gap between Branded and Private-Label Products Tell Us about Markups? , Robert B. Barsky, Mark Bergen, Shantanu Dutta, Daniel Levy. in Scanner Data and Price Indexes, Feenstra and Shapiro. 2003

 
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