Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies

This paper develops the following price indicators to measure the relative efficiency (functioning) of markets: (a) price dispersion, (b) price volatility, and (c) price transmission (speed, completeness, and symmetry). The paper uses these indicat...

Full description

Bibliographic Details
Main Authors:	Sanchez-Bayardo, Luis Fernando, Gonzalez, Alvaro, Iacovone, Leonardo
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2018
Subjects:	PRICES COMPETITION ENTRY INTEGRATON
Online Access:	http://documents.worldbank.org/curated/en/110401515422368009/Micro-level-analysis-of-Mexican-retail-markets-and-their-response-to-changes-in-market-structure-and-competition-policies http://hdl.handle.net/10986/29157

id	okr-10986-29157
recordtype	oai_dc
spelling	okr-10986-291572021-06-08T14:42:48Z Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies Sanchez-Bayardo, Luis Fernando Gonzalez, Alvaro Iacovone, Leonardo PRICES COMPETITION ENTRY INTEGRATON This paper develops the following price indicators to measure the relative efficiency (functioning) of markets: (a) price dispersion, (b) price volatility, and (c) price transmission (speed, completeness, and symmetry). The paper uses these indicators to study trends and conditions of the outlet level in retail prices for common commodities sold throughout Mexico. The analysis examines price patterns for each indicator across commodities, regions, and time. The descriptive results indicate that although there is (expected) heterogeneity in the behavior of these indicators across commodities, location variables explain the most variation in the indicators. There are clear and persistent regional- and commodity-specific effects. Thus, the study concludes that Mexico is not one, well-integrated national market. The study tested whether changes in these indicators (increased efficiency) have the expected correlation with measures affecting the functioning of markets. It considered changes in competition and entry of large retail stores in the local retail market. These changes affect market efficiency in the way theory would predict. The results suggest that these indicators are good measures of the relative efficiency (functioning) of markets. The findings also suggest that efforts to monitor markets using these indicators may be useful. For example, for policy makers who are concerned about the distributional effects of liberalizing trade, the indicators may predict where price impacts will be felt the most and by whom. In addition, the indicators provide preliminary information about relative competition levels, which may be helpful in saving the time and effort of the competition authorities and possibly making them more effective. 2018-01-16T17:08:24Z 2018-01-16T17:08:24Z 2018-01 Working Paper http://documents.worldbank.org/curated/en/110401515422368009/Micro-level-analysis-of-Mexican-retail-markets-and-their-response-to-changes-in-market-structure-and-competition-policies http://hdl.handle.net/10986/29157 English Policy Research Working Paper;No. 8294 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Latin America & Caribbean Mexico
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	PRICES COMPETITION ENTRY INTEGRATON
spellingShingle	PRICES COMPETITION ENTRY INTEGRATON Sanchez-Bayardo, Luis Fernando Gonzalez, Alvaro Iacovone, Leonardo Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
geographic_facet	Latin America & Caribbean Mexico
relation	Policy Research Working Paper;No. 8294
description	This paper develops the following price indicators to measure the relative efficiency (functioning) of markets: (a) price dispersion, (b) price volatility, and (c) price transmission (speed, completeness, and symmetry). The paper uses these indicators to study trends and conditions of the outlet level in retail prices for common commodities sold throughout Mexico. The analysis examines price patterns for each indicator across commodities, regions, and time. The descriptive results indicate that although there is (expected) heterogeneity in the behavior of these indicators across commodities, location variables explain the most variation in the indicators. There are clear and persistent regional- and commodity-specific effects. Thus, the study concludes that Mexico is not one, well-integrated national market. The study tested whether changes in these indicators (increased efficiency) have the expected correlation with measures affecting the functioning of markets. It considered changes in competition and entry of large retail stores in the local retail market. These changes affect market efficiency in the way theory would predict. The results suggest that these indicators are good measures of the relative efficiency (functioning) of markets. The findings also suggest that efforts to monitor markets using these indicators may be useful. For example, for policy makers who are concerned about the distributional effects of liberalizing trade, the indicators may predict where price impacts will be felt the most and by whom. In addition, the indicators provide preliminary information about relative competition levels, which may be helpful in saving the time and effort of the competition authorities and possibly making them more effective.
format	Working Paper
author	Sanchez-Bayardo, Luis Fernando Gonzalez, Alvaro Iacovone, Leonardo
author_facet	Sanchez-Bayardo, Luis Fernando Gonzalez, Alvaro Iacovone, Leonardo
author_sort	Sanchez-Bayardo, Luis Fernando
title	Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
title_short	Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
title_full	Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
title_fullStr	Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
title_full_unstemmed	Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies
title_sort	micro-level analysis of mexican retail markets and their response to changes in market structure and competition policies
publisher	World Bank, Washington, DC
publishDate	2018
url	http://documents.worldbank.org/curated/en/110401515422368009/Micro-level-analysis-of-Mexican-retail-markets-and-their-response-to-changes-in-market-structure-and-competition-policies http://hdl.handle.net/10986/29157
_version_	1764468637235675136

Micro-Level Analysis of Mexican Retail Markets and Their Response to Changes in Market Structure and Competition Policies

Similar Items