Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments May 5, 2023 erstellt
Beschreibung:
This paper documents substantial time variation in price elasticities of demand and therefore markups. We propose a two-step procedure to identify time-varying markups. Using data of US grocery stores from 2001-2020 we first estimate elasticities at the market-good-year level. We then efficiently aggregate these data by year to estimate a common trend and cyclical variation in elasticities. We estimate (i) a secular increase in U.S. grocery store markups of 3.9% per year over the sample period and (ii) a 13.6% cyclical decline at times of aggregate demand contractions. Our results imply pro- cyclical changes in markups. Across markets, elasticities vary with market-wide factors that we expect to influence preferences and market structure—real GDP, unemployment and market concentration