Why Unit Prices of Supermarket Products Vary

Michael L. Walden

10 citations0/0 files storedJournal of Consumer Affairs

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Consumer Market Behavior and Pricing Merger and Competition Analysis Consumer Packaging Perceptions and Trends

Abstract

A variation in unit price among different sizes of the same product has been observed in many studies of supermarkets. Quantity price premiums have also been observed. This study reviews theoretical explanations for variation in unit prices and tests the explanations using data from a southeastern supermarket chain. The empirical results indicate that packaging characteristics and storage characteristics of a product are significantly related to unit price variation and to the probability of quantity price premiums.

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1976Commodity Bundling and the Burden of Monopoly 1977The Noisy Monopolist: Imperfect Information, Price Dispersion and Price Discrimination 1980Multi-Product Quantity-Dependent Prices and Profitability Constraints 1988The Economics of Tie-in Sales 1960The Economics of Tie-In Sales 1973Why the Poor May Pay More for Food: Theoretical and Empirical Evidence 1952The Theory of Monopolistic Quantity Discounts 1979Measurement of Incidents of Quantity Surcharge Among Selected Grocery Products

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