Gatekeepers to consumer markets: the role of retailers in international trade

This study explores how recent developments in the retail sector affect trade in consumer goods. It focuses on three developments in the retail sector: (i) internationalization; (ii) market structure; and (iii) the growing market share of retailers' private labels. Using gravity model estimation techniques it is found that the foreign operations of a retailer are positively related to imports from the host to the home country of the retailer. Imports are negatively related to ownership concentration, while the market share of private labels is negatively related to imports of food and positively related to imports of non-food consumer goods. For both product categories private labels shift sourcing towards poor countries. The trade response to trade liberalization is higher both at the extensive and intensive margin in countries with lower retail concentration.     

Food waste in the retail sector: A survey-based evidence from Central and Eastern Europe

This paper explores the issue of food waste in the Lithuanian retail sector. A questionnaire survey was designed in order to collect the relevant data from both the largest retail chains with stores around the country and companies with small-scale stores in rural areas. The present case is interesting as the literature on Central and Eastern European countries is scarce in the sense of the quantification of food waste. In this paper, the amounts of food waste among different food product categories are discussed and then extrapolated to approximate food waste in retail trade for Lithuania by using sales revenue as a key parameter. The results suggest that food waste in the Lithuanian retail sector amounts to 36.4 thousand tonnes or 13.0 kg per capita per year. Fruits and vegetables account for more than a half (63%), whereas meat (products) come next representing some 9% of food waste. Therefore, these products can be considered as the major targets for valorisation schemes and other measures aimed at mitigation of food waste.     

Barcode Empires: Politics,Digital Technology,and Comparative Retail Firm Strategies

Like other service sectors, information technology has dramatically altered the growth and character of the retail trade sector in the affluent economies. Nevertheless, significant variation exists in the typical strategies of retail firms in different countries. This article explores this variation and proposes an explanation for why retailers achieved scale and solved their make, buy, and partner decisions along such different trajectories. It argues that national bases for scale retailing were shaped by a series of political negotiations starting in the 1960s and 1970s. This demonstrates once again that technology implementation is rarely determined by the technology itself, but more often by social and political rules. Future technology platforms, such as web-based or mobile commerce, should be expected to follow similar political logics. As multinational retailing firms spread around the globe, this has important implications for national competition policy.     

Trade,Technology and Human Capital: Stylised Facts and Quantitative Evidence

Stylised evidence on trade, total factor productivity (TFP) and skill intensity of the labour force is presented. Features emerging as salient are: growing trade in technology‐intensive products from the industrialised nations to the relatively laggard nations leads to embodied technology diffusion; the technology‐intensive sectors have larger shares of skilled workers; countries experiencing TFP growth usually have higher levels of educational attainment; also, the skilled labour payment share for a sector is positively associated with that sector’s regional trade share. These facts together help explain why endowment of more skilled labour facilitates absorption of technology ferried via trade.     

Enlargement and the Textiles,Clothing and Footwear Industry

The textiles, clothing and footwear (TCF) industry is a labour intensive industry, strongly determined by globalization and easy relocation to low‐cost countries. Hence also in the European Union this industry is relatively more important in the low‐wage regions of the EU‐Southern periphery. With the envisaged enlargement, however, these countries fear a further shift of the sector to Central and Eastern Europe as these countries still have a comparative advantage in terms of low labour costs. The present article investigates whether this fear is justified, looking at three main aspects: first at the position and history of the TCF sector in the European Union and its role in the EU periphery, second at the sector in the Central and Eastern accession countries, and third at gobalization issues. The second aspect is dealt with in great detail, as development trends in the Central and East European countries are important and telling. Much has happened during the 15‐year (and more) period between the collapse of communism and the EU membership in this region, most important the integration to the EU by the means of trade, in particular outward processing trade. These developments mainly seem to determine future trends in an enlarged Europe. Overall however, future prospects have to be seen in a global context, strongly influencing the sector via changes in global trade policies.     

Mind the Gender Wage Gap – the Impact of Trade and Competition on Sectoral Wage Differences

This paper examines differences between women’s and men’s wages in 18 selected OECD countries in the period 1970 to 2005. The study is based on 12 manufacturing sector‐ and skill‐specific sets of panel data on the gender wage gap. We apply a system generalised method of moments (GMM) estimator to the extended version of the conditional gender wage gap convergence equation, controlling for sector concentration and industry‐specific measures of openness using a difference‐in‐difference approach: trade‐affected concentrated sectors versus trade‐affected competitive sectors. The results indicate that: (i) an increase in sector concentration is associated with wage gap growth; (ii) both import and export penetration are associated with a reduction of the high‐skill gender wage gap growth in concentrated industries; (iii) there is evidence of a widening impact of trade on the medium and low‐skill occupational gender wage gap growth in less competitive industries; (iv) institutional regulations of the labour market have an impact on the development of the gender wage gap: for highly‐skilled labour an increase in labour market regulation raises the growth of the gender wage gap, while for medium‐ and low‐skilled workers, it lowers it.     

Retailing establishments: A competitive analysis of commercial formats from the consumers’ profiles and perceptions

During recent years the retail trade sector has clearly been immersed in a period of continuous transformation, one of the consequences of which has been the appearance of commercial formats coming into direct competition with the so-called traditional commercial formats, with their medium-sized outlets, poor range of choice and low prices, but with products of a medium-high quality. The aim of this current work is to analyse the competitive situation of the so-called traditional retailers compared to the modern commercial formats, focusing on the food and mass consumer products sector from the perspective of the users’ perceptions. By means of the appropriate statistical analysis, the characteristics of each type of format are defined, as well as the profile of the users. The study was carried out in the province of Cadiz—one of the areas of Spain in which retail trade has evolved most rapidly.     

Foreign trade potential,small enterprise development and job creation in developing countries

Increasing American competitiveness in the international economy requires expanding trade with emerging markets, especially in developing countries of Asia, Latin America and Africa. Historically, as developing countries' economies have grown, the capacity for exporting and importing have both expanded. In the future, the capacity for trade in developing countries will depend increasingly on their ability to create sufficient numbers of jobs to absorb their rapidly growing labor forces.Unlike Western countries, most developing economies have a small percentage of their labor forces in large-scale manufacturing and a large share engaged in small-scale and informal sector enterprises. Small-scale enterprises have been the primary sources of labor absorption in cities in developing countries and will continue to play a crucial role in the future. Experience has shown that policies for improving the capacity of small-scale enterprises to generate jobs have had only mixed results in developing countries. The challenge facing governments and the private sector in the future include: (1) creating an economic environment conducive to small-enterprise development; (2) removing regulatory and administrative obstacles to small-enterprise expansion; (3) tailoring small-enterprise promotion programs to local conditions and needs; (4) providing capital and credit for small-business owners; (5) involving the private sector in small-enterprise development programs; and (6) providing technical assistance, training and educational programs through public-private partnerships.     

Welfare-optimal trade and competition policies in small open oligopolistic economies

Standard trade theory claims that free trade is welfare-enhancing. We show that this is not the case if at least one sector of the economy is a Cournot oligopoly. In a simple small open economy with one oligopolistic and one competitive sector, welfare is an inverted U-shaped function of tariffs. Hence, an optimal tariff rate can be determined. The optimal rate depends on the number of firms in the oligopolistic sector. Below the optimal level, the competitive sector overproduces, i.e. oligopolistic good have a higher marginal effect on welfare. Increasing tariff rates stimulate the production of the oligopolistic sector by dampening imports. Under balanced trade, this reduces exports and production in the competitive sector, thus shifting resources to oligopolistic goods production. We also find that given certain levels of protection, perfect competition is not welfare maximal and, hence, not desirable. The finding explains why developing economies with imperfect competition are often reluctant to embrace trade liberalization and why, conversely, countries with high levels of external protection may be unenthusiastic about competition theory.     

Trade‐Adjusted Concentration Ratios in the US Manufacturing Sector

This paper incorporates international trade into the four‐firm concentration ratio to get a more realistic measure of market structure in the US manufacturing sector using 1997 and 2002 NAICS data. As expected, trade‐adjusted CR₄ is significantly lower than the published CR₄. Moreover, the effect of international trade is higher in 2002 than in 1997, offsetting the increase in domestic concentration and leaving the US manufacturing sector in 2002 as competitive as it was in 1997. Furthermore, different tests are used to check the validity of the results. All of them confirm that trade‐adjusted CR₄s are significantly lower than their published counterparts.     

External Asymmetries in the Euro Area and the Role of Foreign Direct Investment

Soon after the introduction of the common currency, a divide emerged between two groups in the Euro area: one comprised of the North European countries achieving external surpluses and the other of the South European countries with large external deficits. This paper shows that different patterns of foreign direct investment (FDI) inflows across the Euro area countries contributed to this divergence. Our theoretical framework shows that if the economy is relatively capital‐intensive in the production of traded (non‐traded) output, FDI will be channelled in greater proportions to the traded (non‐traded) sector, thus improving (deteriorating) the trade balance. Focusing on ten Euro area countries over the period 1980 to 2009, we establish a positive (negative) long‐run effect of FDI inflows on the trade balance in the North (South). In the North, the positive effect stems from the traded sector FDI inflows that were significantly higher in comparison with the South, both before and after the EMU. In contrast, in the South, the increased FDI inflows in the post‐EMU era were dominated by investments in the non‐traded sector. When industry‐level data are employed, a positive (negative) long‐run effect of manufacturing (non‐manufacturing) FDI inflows on the trade balance in the North (South) is further established.     

Market Structure and Market Access

We explore an issue at the nexus of domestic competition policy and international trade, the interaction between goods trade and market power in domestic trade and distribution sectors. We examine the effect of variations in conditions of domestic competition in services on trade volumes in goods in the cases of both linear and nonlinear import demand, including standard form CES‐based gravity models of bilateral trade flows. Theory suggests a set of linkages between service‐sector pricing and goods trade supported by econometrics involving imports of 22 OECD countries vis‐a‐vis 69 exporters. Competition in distribution services affects the volume of trade in goods. Additionally, because of interaction between tariffs and pricing, the market structure of the domestic service sector becomes increasingly important as tariffs are reduced. Indeed, depending on the degree of competition, market access concessions on tariffs may be effectively undone in some cases by changes in margins. For exporters, we find that service competition in destination markets matters most for exporters from smaller, poorer countries. Our results also suggest that while negotiated agreements leading to cross‐border services liberalisation may boost goods trade as well, they may also lead to a fall in goods trade when such liberalisation involves FDI leading to increased service sector concentration.     

Microenterprise,Multinational Business Support,and Poverty Alleviation in South Africa's Informal Economy

The authors examine corporate programs that support microenterprise development in Africa. Specifically, the analysis assesses the extent to which local income and sales are affected by Coca-Cola's initiatives to assist South Africa's microenterprise in the retail trade sector. To quantify the impact, questionnaires were obtained from owners of small-scale retail establishments in the country's vast informal economy. Regression analysis is performed on key variables from the survey, testing hypotheses advanced to explain the size of an owner's income and sales. In addition to business development support, the explanatory variables include startup capital, size, and male/female ownership. It appears that business development support has a positive effect on lifting income and reducing poverty for microenterprise owners, after controlling for other influences.     

When strategy pales: Lessons from the department store industry

The traditional department store was clearly the center of retail activity in cities and small towns in the United States during the first half of the 20^th century. However, by the late 1970s and beyond, the department store industry began experiencing financial problems, and serious questions were being raised as to whether their demise was eminent. This article traces the evolution of the industry, and explores some of the underlying dynamics for the changes in the retail trade sector, including the emergence of new alternative retail formats, such as discount stores and category killers. This study further explores the major strategies used by the leading traditional stores with reference to new industry life cycle models and a strategic positioning framework. Of particular interest is the discussion regarding: Were the traditional department stores “locked in” to a declining trajectory? How effective were their strategies to counter the decline of the industry? And what were and are the repositioning options available to the traditional department stores?     

市场结构优化及黑龙江省零售业提高竞争力探析

市场结构是决定市场行为和市场绩效的基础,而市场行为又是决定市场绩效的前提条件,市场绩效受市场结构和市场行为的共同制约。黑龙江省零售业存在着市场集中度低、产品差异性小、业态分布不合理等诸多市场结构问题,严重影响了零售企业的竞争力,制约了零售业的健康持续发展。应采取培育大型零售企业集团、调整网点结构、找准市场定位、实行差别化经营等措施,推进和引导市场结构优化,大力增强零售业市场竞争力。     

Price–Quality and Market Share of Consumer Goods in Spain: Retail Brands and Manufacturer Brands1

The development of retail brands has been favoured by the creation of large chains and by the high level of business concentration in the retail sector. It has been supported by an increasing number of consumers who are aware of value and consider that retail brand is the best alternative, with quality levels similar to those of leading manufacturer brands but with lower prices. In this survey, we analyse the price differentials between manufacturer brands and retail brands in several categories of widely consumed products. We study the relationship between the price differential and the mean category price with the market share of retail brands, for foodstuff, perfumes and cleaning materials categories. Finally, we determine the possible connection between the price of a consumer good brand and its real quality.     

Local costs of distribution,international trade costs and micro evidence on the law of one price

This paper connects trade flows to deviations from the law of one price (LOOP) in a structural model of trade and retailing. It accounts for the observed cross-country dispersion in prices of goods, based on retail price survey data, by focusing on two sources of goods market segmentation — (i) international trade costs, and (ii) non-traded input costs of distribution. I find that a multi-sector Ricardian trade model, ala Eaton–Kortum, augmented with a distribution sector, can account for the average price dispersion for a basket of goods fully and generates 70% of the variation in price dispersion across goods within the basket. While tradability of goods is important in explaining the average price dispersion for the basket of goods, distribution costs are important in explaining why, within the basket, some goods show more price dispersion than others.     

Trade Liberalisation: The Effects of Free Trade Agreements on the Competitiveness of the Dairy Sector

In recent years, preferential trade agreements (PTAs), free trade agreements (FTAs) in particular, have proliferated while WTO negotiations have stagnated. This paper contributes to the literature on trade liberalisation and the agricultural sector by analysing the effects of FTAs on the competitiveness of the dairy sector across 76 countries and over a 20‐year period from 1990 to 2009. With a longitudinal econometric model, the results demonstrate that when a country has a revealed comparative advantage in the dairy sector, FTAs positively influence several indicators of competitiveness in the dairy sector, such as production, market share and trade balance. The results also indicate that multilateral FTAs are more beneficial than bilateral FTAs. There is strong empirical evidence that FTAs are more beneficial to developed countries than to developing countries. There is no statistical evidence to support the hypothesis about a relationship between FTAs and farm‐gate price.     

Retail trade and payment innovations in the digital era: a cross-industry and multi-country approach

Abstract

This article introduces a novel approach to payment innovations. It t identifies a cross-industry (retail trade and retail banking) and multi-country (USA, some Western European countries and Japan) approach to the interaction between these industries and the new retail payment systems from the 1970s to the mid 1990s. It documents and discusses the different trajectories that have been seen in the different competitive environments, particularly in regard to payment cards. It also analyses the involvement of bankers and retailers in the evolution of card payment systems and their contribution to the global adoption of bank cards. These processes have occurred within a framework in which sectoral boundaries have taken precedence over the payment alternatives associated with cross-industry solutions.