Buyer and seller power in grocery retailing: Evidence from Italy

Monica Giulietti*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


This work investigates the effect of upstream and downstream market concentration on retailers' price-cost margins using bimonthly data over the period 1989-1992 disaggregated by retailer type and product. In addition to horizontal concentration, differentiation, and cost factors, the analysis includes buyer power amongst the determinants of retailers' profitability, as a result of vertical bargaining. Using a fixed effects model in first differences we find evidence of bargaining activity between large chains and food manufacturers. Our analysis of price competition at the retail level also reveals some interdependence in the pricing decisions of the largest retail organisations and price leadership by large independent shops.

Original languageEnglish
Pages (from-to)109-125
Number of pages17
JournalRevista de economia del rosario
Issue number2
Publication statusPublished - 1 Dec 2007


  • Italian grocery trade
  • Panel data
  • Price competition
  • Price-cost margins
  • Vertical bargaining


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