How firms compete when they set identical prices: Nonprice strategies in the Indian biscuit industry.

Autor:	Antonecchia, Gianluca, Bhaskarabhatla, Ajay
Předmět:	PRICES BISCUIT industry PRICE discrimination BUSINESS enterprises STANDARD deviations RURAL geography
Zdroj:	Journal of Economics & Management Strategy; Oct2023, Vol. 32 Issue 4, p733-756, 24p, 8 Charts, 4 Graphs
Abstrakt:	How do firms compete when all firms in an industry set identical prices? Using Nielsen data on India's biscuit manufacturers, we document productivity‐based competition on nonprice strategies under industry‐wide uniform pricing. Products with one standard deviation higher quantity‐based productivity contain, on average, 13% more quantity per pack for the same price. Productivity also positively correlates with promotions on pack size, availability, and variety. A higher price (per pack size) sensitivity in rural markets combined with industry‐wide uniform pricing imposes a greater burden on rural consumers. Additional analyses show that firms can reduce this burden by selling different pack sizes in urban and rural areas. [ABSTRACT FROM AUTHOR]
Databáze:	Complementary Index
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