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Free University of Bozen-Bolzano

31 May 2022 12:30–14:00

Price Dispersion in Wines

Research seminar

Speakers Olivier Gergaud

Date 31 May 2022 12:30 - 14:00

Location Room BZ E4.22, Universitätsplatz 1 - Piazza Università, 1, 39100 Bozen-Bolzano

More information Prof. Federico Boffa



We investigate price dispersion in restaurant sales of wine. We measure empirically the change in price dispersion as competition varies, finding that price dispersion increases with competition. We then propose a spatial model capturing the unique features of restaurant dining to explain this empirical regularity. The model reveals an indirect effect flowing through the price of food, which is announced and known by customers, to the price of wine, which is only revealed once the customer enters the restaurant and receives the wine list. The results add to the literature on "add ons" and price dispersion in bundled good markets.

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