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INTRACITY PRICE DISPERSION: EVIDENCE FROM ISTANBUL

Yıl 2017, Cilt: 13 Sayı: 4, 705 - 718, 01.10.2017
https://doi.org/10.17130/ijmeb.2017433403

Öz

The existence of price dispersion is one of the most well known principles of economic theory. Earlier studies concentrated on international purchasing power parity PPP deviations. In recent years several studies have examined price dispersion within a nation’s borders. In this article the price dispersion among the districts of Istanbul is analyzed by utilizing a data set containing microeconomic price levels from bazaars, convenience stores, and supermarkets. According to results of the study, the prices of homogenous products, except fruit and vegetables, vary less than the prices of differentiated goods as one might expect. Results also indicate that, type of the seller of the product effects price dispersion among the counties of Istanbul

Kaynakça

  • Anderson, E. J., & vanWincoop, E. (2004). Trade costs. Journal of Economic Literature, 42 (3), 691-751.
  • Atkeson, A., & Burstein, A. (2004, November). International relative prices in new ricardian models of international trade. Manuscript, UCLA.
  • Benabou, R. (1988). Search, price setting and inflation. The Review of Economic Studies, 55 (3), 353-376.
  • Benabou, R. (1992). Inflation and efficiency in search markets. The Review of Economic Studies, 59 (2), 299-329.
  • Bergin, R. P., & Glick, R. (2003). Endogenous nontradability and macroeconomic implications. NBER Working Paper, W9739.
  • Bergman, M., Heebol, C., & Hansen, N.L. (2015). Intranational price convergence and price stickiness: Evidence from Denmark. Manuscript.
  • Caglayan, M., Filiztekin, A., & Rauh, M.T. (2008). Inflation, price dispersion, and market structure. European Economic Review, 52 (7), 1187-1208.
  • Casella, A., & Feinstein, J. (1990). Economic exchange during hyperinflation. Journal of Political Economy, 96, 1-27.
  • Cecchetti, S., Nelson, M., & Sonora, R. (2002). Price level convergence among united states cities: Lessons for the European Central Bank. International Economic Review, 43 (4), 1081-1099.
  • Ceglowski, J. (2003). The law of one price: Intranational evidence for Canada. Canadian Journal of Economics, 36 (2), 373-400.
  • Chamberlin, E. (1933). The theory of monopolistic competition. Cambridge, Mass: Harvard University Press.
  • Chen, N. (2004). The behaviour of relative prices in the European Union: A sectoral analysis. European Economic Review, 48 (6), 1257-1286
  • Chen, LL., & Devereux, J. (2003). What can US city price data tell us about purchasing power parity?. Journal of International Money and Fınance, 22(2), 213-222.
  • Cheung, Y-W., Chinn, M.D, & Fujii, E. (2001). Market structure and the persistence of sectoral real exchange rates. International Journal of Finance and Economics, 6 (2), 95-114.
  • Crucini, M., Telmer, C., & Zachariadis, M. (2004). Price dispersion: The role of borders, distance, and location. Carnegie Mellon University GSIA Working Paper, 2004-E25.
  • Crucini, M., Telmer, C., & Zachariadis, M. (2005). Understanding european real exchange rates, The American Economic Review, 95(3), 724-738.
  • Crucini, M., & Shintani, M. (2008). Persistence in law of one price deviations: Evidence from micro-data. Journal of Monetary Economics, 55(3), 629-644.
  • Crucini, M., Shintani, M., & Tsuraga, T. (2015). Noisy information, distance, and law of one price dynamics across US cities. Journal of Monetary Economics, 74(September), 52- 66.
  • Crucini, M., & Smith, G.W. (2014). Geographic barriers to commodity price integration: Evidence from US cities and Swedish towns 1732-1860. NBER Working Paper, 20247.
  • Crucini, M., & Yilmazkuday, H. (2014). Understanding long-run price dispersion. Journal of Monetary Economics, 66(September), 226-240.
  • Culver, S., & Papell, D. (1999). Panel evidence of purchasing power parity using intranational and international data. Unpublished Manuscript.
  • Debelle, G., & Lamont, O. (1997). Relative price variability and inflation: Evidence from US cities. Journal of Political Economy, 105(1), 132-152.
  • Diamond, P. (1993). Search, sticky prices and inflation. Review of Economic Studies, 60 (January), 53-68.
  • Elberg, A. (2016). Sticky prices and deviations from the Law of One Price: Evidence from Mexican micro-price data. Journal of International Economics, 98(January), 191-203.
  • Engel, C., & Rogers J. H. (1996). How wide is the border?. The American Economic Review, 86(5), 1112-25.
  • Engel, C., Rogers, J. H., & Wang, S.Y. (2003). Revisiting the border: An assessment of the Law of One Price using very disaggregated consumer price data. InternationalFinance Discussion Papers, 777.
  • Fan, S., & Wei, X. (2006). The law of one price: Evidence from the transitional economy of China. Review of Economics and Statistics, 88(4), 682-697.
  • Fershtman, C., Fishman, A., & Simhon, A. (2003). Inflation and efficiency in search economy. International Economic Review, 44, 205-222.
  • Goldberg, P. K., & Verboven, F. (2001). The evolution of price dispersion in the European Car Market. Review of Economic Studies, 4, 811-848
  • Head, A., & Kumar, A. (2005). Price dispersion, inflation and welfare. International Economic Review, 46(2), 533-572.
  • Hickey, R. D., & Jacks, D. S. (2011). Nominal rigidities and retail price dispersion in Canada over the twentieth century. Canadian Journal of Economics, 44(3), 749-780.
  • Hotelling, H. (1929). Stability in competition. Economic Journal, 39, 41-57.
  • Lach, S. (2002). Existence and persistence of price dispersion: An empirical analysis. The Review of Economics and Statistics, 84 (3), 433-444.
  • Midrigan, V. (2007). International price dispersion in statte-dependent pricing models. Journal of Monetary Economics, 55(8), 2231-2250.
  • O'Connell, P., & Wei, S. J. (2002). The bigger they are, the harder they fall: Retail price differences across US cities. Journal of International Economics, 56, 21-53.
  • Parsley, D. C. (1996). Inflation and relative price variability in the short and long run: New evidence from the United States. Journal of Money, Credit and Bankingh, 28 (3), 323- 341.
  • Parsley, D. C., & Wei, S. J. (1996). Convergence to the law of one price without trade barriers or currency fluctuation. The Quarterly Journal of Economics, 111 (4), 1211-1236.
  • Parsley, D. C., & Wei, S. J. (2001). Explaining the border effect: the role of exchange rate variability, shipping costs, and geography. Journal of International Economics, 55, 87- 105.
  • Peterson, B., & Shi, S. (2002). Money, price dispersion and welfare. Manuscript, Indiana University and University of Toronto.
  • Rauch, J. (1999). Networks vs. markets in international trade, Journal of International Economics, 48, 7-35.
  • Reinsdorf, M. (1994). New evidence on the relationship between inflation and price dispersion, American Economic Review, 84(3), 720-731.
  • Tommasi, M. (1994). The consequences of price instabilityon search markets: Toward understanding the effects of inflation. American Economic Review, 84(December), 1385-1396.
  • Tommasi, M. (1999). On high inflation and the allocation of the resources. Journal of Monetary Economics, 44(December), 401-421.
  • Tsurata, Y. (2008). What affects intranational price dispersion?: The case of Japanese gasoline prices. Japan and the World Economy, 20(4), 563-584.
  • Van Hoomissen, T. (1988). Price dispersion and inflation: Evidence from Israel. Journal of Political Economy, 96(6), 1303-1314.

INTRACITY PRICE DISPERSION: EVIDENCE FROM İSTANBUL

Yıl 2017, Cilt: 13 Sayı: 4, 705 - 718, 01.10.2017
https://doi.org/10.17130/ijmeb.2017433403

Öz

The existence of price dispersion is one of the most well known principles of economic theory. Earlier studies concentrated on international purchasing power parity PPP deviations. In recent years several studies have examined price dispersion within a nation’s borders. In this article the price dispersion among the districts of Istanbul is analyzed by utilizing a data set containing microeconomic price levels from bazaars, convenience stores, and supermarkets. According to results of the study, the prices of homogenous products, except fruit and vegetables, vary less than the prices of differentiated goods as one might expect. Results also indicate that, type of the seller of the product effects price dispersion among the counties of Istanbul.

Kaynakça

  • Anderson, E. J., & vanWincoop, E. (2004). Trade costs. Journal of Economic Literature, 42 (3), 691-751.
  • Atkeson, A., & Burstein, A. (2004, November). International relative prices in new ricardian models of international trade. Manuscript, UCLA.
  • Benabou, R. (1988). Search, price setting and inflation. The Review of Economic Studies, 55 (3), 353-376.
  • Benabou, R. (1992). Inflation and efficiency in search markets. The Review of Economic Studies, 59 (2), 299-329.
  • Bergin, R. P., & Glick, R. (2003). Endogenous nontradability and macroeconomic implications. NBER Working Paper, W9739.
  • Bergman, M., Heebol, C., & Hansen, N.L. (2015). Intranational price convergence and price stickiness: Evidence from Denmark. Manuscript.
  • Caglayan, M., Filiztekin, A., & Rauh, M.T. (2008). Inflation, price dispersion, and market structure. European Economic Review, 52 (7), 1187-1208.
  • Casella, A., & Feinstein, J. (1990). Economic exchange during hyperinflation. Journal of Political Economy, 96, 1-27.
  • Cecchetti, S., Nelson, M., & Sonora, R. (2002). Price level convergence among united states cities: Lessons for the European Central Bank. International Economic Review, 43 (4), 1081-1099.
  • Ceglowski, J. (2003). The law of one price: Intranational evidence for Canada. Canadian Journal of Economics, 36 (2), 373-400.
  • Chamberlin, E. (1933). The theory of monopolistic competition. Cambridge, Mass: Harvard University Press.
  • Chen, N. (2004). The behaviour of relative prices in the European Union: A sectoral analysis. European Economic Review, 48 (6), 1257-1286
  • Chen, LL., & Devereux, J. (2003). What can US city price data tell us about purchasing power parity?. Journal of International Money and Fınance, 22(2), 213-222.
  • Cheung, Y-W., Chinn, M.D, & Fujii, E. (2001). Market structure and the persistence of sectoral real exchange rates. International Journal of Finance and Economics, 6 (2), 95-114.
  • Crucini, M., Telmer, C., & Zachariadis, M. (2004). Price dispersion: The role of borders, distance, and location. Carnegie Mellon University GSIA Working Paper, 2004-E25.
  • Crucini, M., Telmer, C., & Zachariadis, M. (2005). Understanding european real exchange rates, The American Economic Review, 95(3), 724-738.
  • Crucini, M., & Shintani, M. (2008). Persistence in law of one price deviations: Evidence from micro-data. Journal of Monetary Economics, 55(3), 629-644.
  • Crucini, M., Shintani, M., & Tsuraga, T. (2015). Noisy information, distance, and law of one price dynamics across US cities. Journal of Monetary Economics, 74(September), 52- 66.
  • Crucini, M., & Smith, G.W. (2014). Geographic barriers to commodity price integration: Evidence from US cities and Swedish towns 1732-1860. NBER Working Paper, 20247.
  • Crucini, M., & Yilmazkuday, H. (2014). Understanding long-run price dispersion. Journal of Monetary Economics, 66(September), 226-240.
  • Culver, S., & Papell, D. (1999). Panel evidence of purchasing power parity using intranational and international data. Unpublished Manuscript.
  • Debelle, G., & Lamont, O. (1997). Relative price variability and inflation: Evidence from US cities. Journal of Political Economy, 105(1), 132-152.
  • Diamond, P. (1993). Search, sticky prices and inflation. Review of Economic Studies, 60 (January), 53-68.
  • Elberg, A. (2016). Sticky prices and deviations from the Law of One Price: Evidence from Mexican micro-price data. Journal of International Economics, 98(January), 191-203.
  • Engel, C., & Rogers J. H. (1996). How wide is the border?. The American Economic Review, 86(5), 1112-25.
  • Engel, C., Rogers, J. H., & Wang, S.Y. (2003). Revisiting the border: An assessment of the Law of One Price using very disaggregated consumer price data. InternationalFinance Discussion Papers, 777.
  • Fan, S., & Wei, X. (2006). The law of one price: Evidence from the transitional economy of China. Review of Economics and Statistics, 88(4), 682-697.
  • Fershtman, C., Fishman, A., & Simhon, A. (2003). Inflation and efficiency in search economy. International Economic Review, 44, 205-222.
  • Goldberg, P. K., & Verboven, F. (2001). The evolution of price dispersion in the European Car Market. Review of Economic Studies, 4, 811-848
  • Head, A., & Kumar, A. (2005). Price dispersion, inflation and welfare. International Economic Review, 46(2), 533-572.
  • Hickey, R. D., & Jacks, D. S. (2011). Nominal rigidities and retail price dispersion in Canada over the twentieth century. Canadian Journal of Economics, 44(3), 749-780.
  • Hotelling, H. (1929). Stability in competition. Economic Journal, 39, 41-57.
  • Lach, S. (2002). Existence and persistence of price dispersion: An empirical analysis. The Review of Economics and Statistics, 84 (3), 433-444.
  • Midrigan, V. (2007). International price dispersion in statte-dependent pricing models. Journal of Monetary Economics, 55(8), 2231-2250.
  • O'Connell, P., & Wei, S. J. (2002). The bigger they are, the harder they fall: Retail price differences across US cities. Journal of International Economics, 56, 21-53.
  • Parsley, D. C. (1996). Inflation and relative price variability in the short and long run: New evidence from the United States. Journal of Money, Credit and Bankingh, 28 (3), 323- 341.
  • Parsley, D. C., & Wei, S. J. (1996). Convergence to the law of one price without trade barriers or currency fluctuation. The Quarterly Journal of Economics, 111 (4), 1211-1236.
  • Parsley, D. C., & Wei, S. J. (2001). Explaining the border effect: the role of exchange rate variability, shipping costs, and geography. Journal of International Economics, 55, 87- 105.
  • Peterson, B., & Shi, S. (2002). Money, price dispersion and welfare. Manuscript, Indiana University and University of Toronto.
  • Rauch, J. (1999). Networks vs. markets in international trade, Journal of International Economics, 48, 7-35.
  • Reinsdorf, M. (1994). New evidence on the relationship between inflation and price dispersion, American Economic Review, 84(3), 720-731.
  • Tommasi, M. (1994). The consequences of price instabilityon search markets: Toward understanding the effects of inflation. American Economic Review, 84(December), 1385-1396.
  • Tommasi, M. (1999). On high inflation and the allocation of the resources. Journal of Monetary Economics, 44(December), 401-421.
  • Tsurata, Y. (2008). What affects intranational price dispersion?: The case of Japanese gasoline prices. Japan and the World Economy, 20(4), 563-584.
  • Van Hoomissen, T. (1988). Price dispersion and inflation: Evidence from Israel. Journal of Political Economy, 96(6), 1303-1314.
Toplam 45 adet kaynakça vardır.

Ayrıntılar

Birincil Dil Türkçe
Bölüm Research Article
Yazarlar

Özlem İnanç Tunçer Bu kişi benim

Yayımlanma Tarihi 1 Ekim 2017
Yayımlandığı Sayı Yıl 2017 Cilt: 13 Sayı: 4

Kaynak Göster

APA Tunçer, Ö. İ. (2017). INTRACITY PRICE DISPERSION: EVIDENCE FROM İSTANBUL. Uluslararası Yönetim İktisat Ve İşletme Dergisi, 13(4), 705-718. https://doi.org/10.17130/ijmeb.2017433403