Market integration and transportation: beer in Lao PDR
Author
Editor
- Jens Gammelgaard
- Christoph Dörrenbächer
Summary, in English
To study the process of domestic market integration in Lao People’s
Democratic Republic (hereafter Lao PDR), this chapter explores the
spatial variation in beer prices and its relationship with transport costs and various local market characteristics. More specifically, we study how the price of a 640 ml bottle of Beer Lao varies across the country. In a well- integrated market, we expect the law of one price to hold. Controlling for transaction costs, a homogeneous product should have the same price throughout the market. Sellers trying to charge a higher price will find that potential buyers turn to competing suppliers.
Democratic Republic (hereafter Lao PDR), this chapter explores the
spatial variation in beer prices and its relationship with transport costs and various local market characteristics. More specifically, we study how the price of a 640 ml bottle of Beer Lao varies across the country. In a well- integrated market, we expect the law of one price to hold. Controlling for transaction costs, a homogeneous product should have the same price throughout the market. Sellers trying to charge a higher price will find that potential buyers turn to competing suppliers.
Publishing year
2013
Language
English
Publication/Series
The Global Brewery Industry Markets, Strategies, and Rivalries
Document type
Book chapter
Publisher
Edward Elgar Publishing
Topic
- Other Social Sciences
Status
Published
ISBN/ISSN/Other
- ISBN: 978 1 78100 635 1