Competitive Dynamics of Online and Brick-and-Mortar Retail Prices

This article analyzes the competitive interplay of prices among retail channels: offline (brick-and-mortar) and online (such as retailers’ websites and online marketplaces). Our empirical analysis draws from two data sources: a novel hand-collected price dataset, and a national aggregate scanner dataset. We find evidence of a close competitive relationship between the online and offline channels, and that prices in one channel are highly responsive to changes in the other channel’s prices. B