American Economic Journal:
Macroeconomics
ISSN 1945-7707 (Print) | ISSN 1945-7715 (Online)
The Evolution of US Retail Concentration
American Economic Journal: Macroeconomics
(pp. 71–101)
Abstract
Increasing national concentration has contributed to market power concerns. Yet local trends are more informative about market power in retail, where consumers have traditionally shopped at nearby stores. Using novel product-level census data for all US retailers, we find that local and national concentration increased in parallel and affect most markets, products, and industries. The expansion of multimarket firms into new markets explains most of the increase in national concentration, with consolidation via increases in local market shares increasing in importance between 1997 and 2007. Increases in local concentration can explain one-quarter to one-third of the observed rise in retail gross margins.Citation
Smith, Dominic A., and Sergio Ocampo. 2025. "The Evolution of US Retail Concentration." American Economic Journal: Macroeconomics 17 (1): 71–101. DOI: 10.1257/mac.20220249Additional Materials
JEL Classification
- D22 Firm Behavior: Empirical Analysis
- L13 Oligopoly and Other Imperfect Markets
- L81 Retail and Wholesale Trade; e-Commerce
- R32 Other Spatial Production and Pricing Analysis