Do the Poor Pay More Store-By-Store. Working Paper 437

摘要

There is a long standing interest in the question of whether or not low income households face the same prices as households with higher incomes. If low income households face lower or higher prices than high income households, then income inequality may be greater or lesser than is suggested by simple comparisons of incomes. A priori, an argument can be made for either case. Low income households may face higher prices if they are less mobile than other households and that difference reduces their ability search for stores with lower prices. They may also tend to shop at small, independent stores that cannot purchase wholesale goods in enough volume to receive volume discounts. In addition, higher crime rates may force local stores to pay greater insurance and security costs.