One-stop Shopping Leads to Lower Prices
We analyze how the convenience of one-stop shopping at supermarkets leads to complementary price effects across categories. Such effects occur because a price increase in one category might lead consumers to make all their purchases elsewhere. The threat of such losses in other categories leads to lower prices across the broad which benefits consumers. Our research on this topic (with Pasquale Schiraldi, Howard Smith and Øyvind Thomassen) was recently published in the American Economic Reviewand is summarized in this Stanford Insights article.