Regulation and UK Retailing Productivity: Evidence from Microdata

Jonathan E. Haskel · Raffaella Sadun

48 citations0/0 files storedEconomica

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Consumer Market Behavior and Pricing Global trade and economics Merger and Competition Analysis

Abstract

We explore the effects of planning regulation on the UK retail sector between 1997 and 2003 using microdata from the UK census. We document a shift to smaller shops following a 1996 regulatory change that increased the costs of opening large stores. Our analysis suggests that total factor productivity (TFP) of multi‐store retail chains fell after the introduction of the reform due to the reduction in store size. Overall, the reduction in store size was associated with TFP of retail chains falling by 0.4% per annum, or 40% of the post‐1995 slowdown in UK retail TFP growth.

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References

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