Research
Working Papers
Big-Box Store Expansion and Consumer Welfare (with Justin Leung)
Abstract: Supercenters and warehouse clubs have surged in the US, offering many product categories at low prices. Complementing a literature on their competitive effects, we study how these big-box stores affect consumer welfare by impacting shopping behavior. Our event studies show consumers change product categories per trip, adjust spending across store formats, and pay lower prices after store entries. We develop a novel demand model to incorporate these choices across stores and categories, and separately quantify consumption gains and trip-cost savings. We find households benefit substantially from consuming in supercenters relative to competing retailers, highlighting the importance of the store format.
Rising Concentration of Household Shopping, Superstar Firms, and Implications for Retail Markups (with Justin Leung)
(Conditionally Accepted, American Economic Journal: Applied Economics)
Abstract: This paper documents an increase in concentration of household shopping in the US retail sector from 2004-2019. Despite a growing number of stores, households visit fewer stores, do more one-stop shopping, and increasingly shop at different retailers from each other. We find that the increasing availability of superstar retailers, rises in product variety within stores, and the rise of online shopping contribute to these trends. We explore how these trends are linked with rising retail markups. Our calibration suggests a 5-10 percentage point increase in aggregate retail markups during this period.
Previously circulated as "Rising Retail Concentration: Superstar Firms and Household Demand"
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