Abstract
In the last two decades the Italian food retail industry has changed considerably also thanks to the liberalization process started with the 1998 retail regulation reform. In this study, we investigate the impact of such reform on the food and beverage consumer price index, controlling for the endogenous nature of the policy adoption across regions, and addressing what changes in food retail structure may have driven those effects. We find that the policy had a mitigating effect on food prices, which can be explained by the change in the number and composition of food stores operating in the Italian market, rather than by the changes in store size and in-store services. We find the policy effects not to be statistically different across regions characterized by different levels of liberalization.
Appendix
Model diagnostics: pooled data regression with full sample (top panel) and with effect of the BRR by regions' degree of liberalization. Auxiliary GMM regressions.
| Retail Structure Metric | Hansen J's test (p value) | F(4,2179) |
|---|---|---|
| Pooled data | ||
| Number of Stores | 0.319 | 13.209 |
| Average selling area | 0.782 | |
| Service index | 0.612 | |
| Low; Medium-High | ||
| Low | ||
| Number of Stores | 0.248 | 490.467 |
| Average selling area | 0.674 | Medium-High |
| Service index | 0.503 | 233.873 |
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