The impact of Wal-Mart in lowering incumbents’ retail prices has been well documented by previous studies using reduced form models. This article uses a structural model to examine the pricing behavior and promotion responses of incumbent supermarkets to a rapid expansion of Wal-Mart...

This article examines the impact of Wal-Mart Supercenters’ entry on incumbents’ pricing behavior and demand. Using a structural model and milk data from the Dallas/Fort Worth supermarket chains, empirical results show that an expansion of Supercenters caused incumbents to price milk...

Social interactions can lead to a variety of phenomena including consumption externalities and complementarities. Consumption externalities arise when the choices of others have an effect on the total value of a household's purchases; complementarities arise when the choices of others have an...