Project Summary

The U.S. food retail landscape has important implications for farmers, consumers, and workers that extend beyond its direct economic importance. Yet previous research on its structure and conduct is somewhat dated, implemented primarily at the aggregate or national level, or descriptive. The proposed project aims to develop new critical knowledge about the evolving food retail entry and market structure at the establishment level and measure its impacts on competition and employment, using a novel dataset and modern economic modeling tools that provide richer and more reliable measures of these impacts in local food markets. We propose to accomplish this in four stages: (1) a comprehensive evaluation of entry, exit, and post-entry performance by retail formats and regions; (2) estimation of industrial organization models of entry and market structure, accounting for store heterogeneity, imperfect information, and dynamics, including entry costs; (3) impacts of these changes on incumbent sales and retail employment, with consideration to spatial competition, retail formats, and the COVID-19 pandemic; and (4) writing up and disseminating this new knowledge to academia, policy markets, and industry. A corollary impact is human capital development by training graduate students in two universities. The new knowledge created by this project will help inform federal policies aimed at promoting competition in the food supply chain and supporting employment development in the evolving food retail landscape.