Abstract
The present paper extends the existing literature on vertical price transmission and cost pass‐through by investigating the impact of product differentiation. We apply distance‐measures of product differentiation to a specific product market (yoghurt) within one country (Germany). Results from a panel‐error‐correction model for 30 products sold in 432 stores over a period of 312 weeks suggest that product differentiation explains a significant share of differences in cost pass‐through rates: more differentiated products command higher prices and are characterised by lower equilibrium cost pass‐through rates as well as more sluggish price adjustment.
| Original language | English |
|---|---|
| Pages (from-to) | 840 - 858 |
| Journal | Journal of Agricultural Economics |
| Volume | 70 |
| Issue number | 3 |
| DOIs | |
| Publication status | Published - 2019 |
Austrian Classification of Fields of Science and Technology (ÖFOS)
- 405002 Agricultural economics