Exaggerated death of distance: Revisiting distance effects on regional price dispersions

• 成果类型: Article
• 署名作者: Kano, Kazuko; Kano, Takashi; Takechi, Kazutaka
• 署名单位: University of Tokyo; Hitotsubashi University; Hosei University
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2013.02.002
• 发表日期: 2013
• 页码: 403-413
• 关键词: law of one price; Regional price dispersion; Transport Cost; Geographical distance; Agricultural wholesale price; Sample-selection bias

摘要

This paper empirically establishes the significant roles of transport costs in price dispersions across regions. We identify and estimate the iceberg-type distance-elastic transport costs as a parameter of a structural model of cross-regional price differentials featuring product delivery decisions. Utilizing a data set of wholesale prices and product delivery patterns of agricultural products in Japan, our structural estimation approach finds large distance elasticities of the transport costs. The result confirms that geographical barriers are an economically significant contributor to the failures of the law of one price. (C) 2013 Elsevier B.V. All rights reserved.