The Rise of Fringe Competitors in the Wake of an Emerging Middle Class: An Empirical Analysis

• 成果类型: Article
• 署名作者: Eizenberg, Alon; Salvo, Alberto
• 署名单位: Hebrew University of Jerusalem; National University of Singapore
• 刊物名称: AMERICAN ECONOMIC JOURNAL-APPLIED ECONOMICS
• ISSN/ISSBN: 1945-7782
• DOI: 10.1257/app.20130104
• 发表日期: 2015
• 页码: 85-122
• 关键词: MARKET POWER; prices; pharmaceuticals; industry; models; CHOICE; SHARES; entry; INDIA

摘要

The emerging middle class is a force of economic importance in many consumer markets around the globe. A striking phenomenon in some of these markets is the growth of generic, low-price brands. This paper examines these phenomena in Brazil's large soft drink market. Our study draws on data sources that capture both social mobility and market outcomes. Our analysis suggests that the emergence of a price-sensitive, new middle class aided the staggering growth of a fringe of generic producers. Our estimated demand model rationalizes a drastic price cut, led by Coca-Cola, that allowed it to contain the fringe's growth.