What Drives Price Dispersion in the European E-commerce Industry?

Kristóf Gyódi; Maciej Sobolewski; Michał Ziembiński

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What Drives Price Dispersion in the European E-commerce Industry?

Kristóf Gyódi

Maciej Sobolewski

oraz

Michał Ziembiński

| 18 gru 2018

Central European Economic Journal

Tom 3 (2017): Zeszyt 50 (December 2017)

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Data publikacji: 18 gru 2018

Zakres stron: 53 - 71

DOI: https://doi.org/10.1515/ceej-2017-0017

Słowa kluczowe
price dispersion, price discrimination, e-commerce, web-scraping, price comparison service

© 2017 Kristóf Gyódi, Maciej Sobolewski, Michał Ziembiński published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Price dispersion in European e-commerce industry compared with Eurostat dataSource: Authors’ own elaboration.

Boxplots - Percentage deviations of median prices – Product Category Variables

Boxplots - Percentage deviations of median prices − Product Subcategory Variables

Boxplots – Percentage deviations of median prices − Country Variables

Tukey’s range test − Product Category Variables

Tukey’s range test − Product Subcategory Variables

Result of Levene’s Test for Homogeneity of Variance − Product Category Variables

	Df	F value	Pr(> F)
group	4	10.53	0.0000
	2546

Frequentist model averaging − relative variable importance

	Importance:	N containing models
GdpR_pc_rep	1	128
pop_density	1	128
E95_price	0.92	128
interest_rate	0.55	128
ele_cost	0.45	128
diesel_price	0.34	128
vat_stdrate	0.29	128

netearnings	0.28	128

Result of the analysis of variance model − Product Category Variables

	Df	Sum Sq	Mean Sq	F value	Pr(> F)
Category	4	0.00	0.00	0.00	1.0000
Residuals	2546	46.95	0.02

Result of analysis of variance model − Product Subcategory Variables

	Df	Sum Sq	Mean Sq	F value	Pr(> F)
Subcategory	16	0.04	0.00	0.15	1.0000
Residuals	2534	46.91	0.02

Results of linear regression 'percent.devation' variable for the

		Model 1			Model 2			Model 3 /4			Final Model
	Estimates	Confidence Intervals	p-values	Estimates	Confidence Intervals	p-values	Estimates	Confidence Intervals	p-values	Estimates	Confidence Intervals	p-values

(Intercept)	-0.0928	-0.20-0.01	0.077	-0.1419	-0.24 - -0.05	0.003	-0.1397	-0.20 - -0.08	<.001	-0.1517	-0.21 --0.09	<.001
pop_density	-0.0002	-0.00 - -0.00	<.001	-0.0002	-0.00 - -0.00	<.001	-0.0002	-0.00 - -0.00	<.001	-0.0002	-0.00--0.00	<.001
netearnings	-0.0064	-0.01 --0.00	0.039	0.0003	-0.00 - 0.00	0.829
ulab_cost	0.0035	0.00-0.01	0.02
vat_stdrate	-0.0013	-0.00 - 0.00	0.385	-0.0003	-0.00 - 0.00	0.831
ele_cost	-0.2056	-0.39 - -0.02	0.033	-0.1069	-0.28 - 0.06	0.217
E95_price	0.0733	-0.02-0.16	0.108	0.08	-0.01 -0.17	0.079	0.087	0.03-0.14	0.003	0.105	0.05-0.16	<.001
diesel_price	0.0093	-0.10-0.11	0.862	0.0227	-0.08-0.13	0.668
GdpR_pc_rep	0.0021	0.00-0.00	<.001	0.0018	0.00 - 0.00	<.001	0	0.00 - 0.00	<.001	0.0014	0.00-0.00	<.001
interest_rate	0.0057	0.00-0.01	0.019	0.0032	-0.00-0.01	0.139	0.0027	-0.00-0.01	0.156
Observations	2551			2551			2551			2551
R²/ adj. R²	.047/.043			.045/.042						.043 / .042

Descriptive statistics of price dispersion determinants in the EU countries

Variable	mean	standard deviation	median	min	max	range	skew	kurtosis
Real [EUR, GDP ths] per capita	25.56	14.85	19.11	4.92	49.36	44.44	0.2	-1.64
Unit [EUR/cost h] of labour	18.67	12.01	15.6	3.8	40.3	36.5	0.45	-1.45
Average annual net salary [EUR/full time]	8.99	5.78	6.83	1.95	18.97	17.02	0.43	-1.51
Electric energy price [EUR/kwh]	0.18	0.06	0.17	0.09	0.3	0.21	0.64	-0.46
Europrice 95 [EUR/petrol litre]	1.31	0.14	1.34	1.1	1.57	0.47	0.2	-1.21
Diesel price [fuel EUR/litre]	1.24	0.1	1.23	1.13	1.54	0.41	1.18	0.87
Cost interest of capital rate [%] – (a)	1.8	1.59	1.14	0.52	7.81	7.29	2.22	5.55
Standard VAT rate [%] (b)	22.04	2.07	21	19	27	8	0.6	-0.69
Population density	130.34	111.73	103.41	17.98	500.57	482.59	1.8	2.96

The number of products and observations in each product category

	# of products
Category	scrapped	after cleaning	in final sample
Fashion	362	154	33
Cosmetics & Healthcare	87	33	24
Households Appliances	58	56	35
Electronics Computer Hardware and	84	75	43
Computer Games and Software	66	64	47
Total	657	382	182

The number of products and observations for EU countries

Country	# of products	# of observations	Country	# of products	# of observations
Austria	143	1,183	Italy	131	910
Belgium	16	37	Latvia	115	2,447
Bulgaria	101	678	Lithuania	92	494
Croatia	91	340	Netherlands	39	380
Czech Republic	144	2,427	Poland	137	1,805
Denmark	127	844	Portugal	36	158
Estonia	58	763	Romania	141	1,152
Finland	73	346	Slovakia	152	1,963
France	92	766	Slovenia	91	469
Germany	70	989	Spain	72	386
Greece	130	1,359	Sweden	144	2,177
Hungary	149	1,482	United Kingdom	131	1,342
Ireland	76	505	Average	102.0	1,016.1

Result of Levene’s Test for Homogeneity of Variance − Product Subcategory Variables

	Df	F value	Pr(> F)
group	16	5.50	0.0000
	2534

Result of analysis of variance model − Country Variables

	Df	Sum Sq	Mean Sq	F value	Pr(> F)
Country	24	4.84	0.20	12.09	0.0000
Residuals	2526	42.11	0.02

The results of the Goldfeld−Quandt test

Goldfeld-Quandt test
data: fit4
GQ = 0.92688, df1 = 1272, df2 = 1271, p-value = 0.912

The results of the Breusch−Pagan test

Studentized Breusch-Pagan test

data: fit4

BP = 1.1911, df = 3, p-value = 0.7551

Result of Levene’s Test for Homogeneity of Variance − Country Variables

	Df	F value	Pr(> F)
group	24	2.23	0.0005
	2526

Results of the VIF Test

variable	Model 1	Model 2	Model 3	Model 4
diesel_price	4.84	4.78
E95_price	5.58	5.56	2.25	2.25
ele_cost	4.02	3.24
GdpR_pc_rep	7.70	7.29	2.23	2.23
interest_rate	2.43	1.97	1.50	1.50
netearnings	38.90	5.78
pop_density	1.55	1.55	1.35	1.35
ulab_cost	40.29
vat_stdrate	1.56	1.44

List of variables used in regression analysis

Name of variable in the model	Variable description
PD: [percent_deviation]	Percentage deviation of the median of product prices in a given country from the average of medians for all countries based on the web scraping study of results from price comparison websites
DS.: [GDP_pc]	Real GDP per capita in EUR thousands, at the end of 2014
DS: [net_earnings]	Average annual net salary in 2014
SS: [pop_density]	Population density – proxy for transportation costs
IE: [vat_stdrate]	Current level of standard VAT rate
SS: [ele_cost]	Unit cost of electric energy, average annual value in 2014
SS: [E95_price]	Euro95 petrol price, average annual value in 2014
SS: [diesel_price]	Diesel oil price, average annual value in 2014
SS: [unit_lab_cost]	Unit cost of labour, average annual value in 2014
SS: [interest_rate]	Current interest rate on 10-year Treasury bonds in the secondary market– capital price index
PC: [Games for PC], [Games for consoles], [Consoles], [Cosmetics], [Laptops and computers], [Small household appliances for the home
< EUR 100], [Small household appliances for the home > EUR 100], [Small household appliances for the kitchen], [Monitors], [Footwear],
[Perfumes], [Software], [Tablets and e-book readers], [Clothing], [Body care appliances] – Binary variables for subcategories of products.

The gross (retail) price dispersion in European e-commerce industry

Category	Subcategory	Average absolute price dispersion	Average # of observation per product	Quantile coefficient of dispersion (0.9-0.1)	Quantile price dispersion (0.9-0.1) [EUR]	Quantile coefficient of dispersion (0.75-0.25)	Quantile price dispersion (0.75-0.25) [EUR]	Coefficient of variation (mean)	Coefficient of variation (median)
Fashion	Clothing	13.9%	9.91	39.3%	27.65	18.3%	12.03	0.35	0.34
Fashion	Footwear	12.3%	12.36	31.1%	27.91	18.0%	16.08	0.25	0.26
Fashion	Accessories	9.9%	7.92	26.4%	21.16	12.1%	10.52	0.54	0.49
Cosmetics & Healthcare	Cosmetics	12.9%	12.72	36.2%	11.93	19.4%	4.28	1.16	1.53
Cosmetics & Healthcare	Perfumes	12.5%	12.53	35.3%	22.91	20.5%	13.2	0.38	0.39
Households Appliances	House	9.6%	6.65	20.9%	12.05	8.7%	5.04	0.35	0.34
Households Appliances	House (>100EUR)	10.4%	7.02	21.1%	58.85	11.3%	30.42	0.78	1.31
Households Appliances	Kitchen	11.4%	7.06	35.5%	64.32	18.4%	35.05	0.78	0.91
Households Appliances	Beauty	13.1%	5.51	31.8%	17.24	17.8%	10.1	0.51	0.5
Electronics and Computer Hardware	Accessories	10.7%	10.05	31.6%	14.98	19.5%	9.78	0.51	0.5
Electronics and Computer Hardware	Laptops and PCs	11.4%	8.67	28.8%	162.74	16.3%	94.61	0.55	0.84
Electronics and Computer Hardware	Monitors	7.8%	9.18	20.6%	39.54	11.5%	19.81	0.95	1.46
Electronics and Computer Hardware	Tablets and E-readers	9.6%	7.36	24.1%	73.57	14.0%	43.34	0.55	0.59
Electronics and Computer Hardware	Consoles	9.6%	10.09	24.0%	67.89	11.7%	32.18	0.4	0.4
Computer Games and Software	Software	11.7%	9.11	32.4%	87.89	18.6%	55.35	0.7	0.81
Computer Games and Software	PC games	12.3%	7.46	35.5%	13.29	21.4%	8.09	0.39	0.36
Computer Games and Software	Console games	10.7%	7.44	31.7%	14.74	18.2%	8.5	0.26	0.25
Total		11,2%	8.93	29.8%		16.2%		0.55	0,66

The pre-tax price dispersion in European e-commerce industry (VAT excluded)

Category	Subcategory	Average absolute price dispersion	Average # of observation per product	Quantité coefficient of dispersion (0.9-0.1)	Quantité price dispersion (0.9-0.1) [EUR]	Quantité coefficient of dispersion (0.75-0.25)	Quantile price dispersion (0.75-0.25) [EUR]	Coefficient of variation (mean)	Coefficient of variation (median)
Fashion	Clothing	14.50%	9.83	39.53%	21.66	20.38%	10.55	0.36	0,34
Fashion	Footwear	12.28%	12.34	31.35%	22.06	17.76%	12.36	0.26	0,27
Fashion	Accessories	9.85%	7.92	24.60%	15.62	13.45%	8.90	0.52	0,47
Cosmetics & Healthcare	Cosmetics	12.51%	12.86	34.11%	9.26	18.51%	3.70	1.17	1,49
Cosmetics & Healthcare	Perfumes	12.46%	12.57	35.35%	17.41	18.93%	8.99	0.37	0,38
Households Appliances	House	10.96%	6.38	25.05%	14.66	12.19%	7.90	0.42	0,39
Households Appliances	House (>100EUR)	8.83%	7.42	22.49%	52.58	13.12%	29.11	0.74	1,22
Households Appliances	Kitchen	11.58%	6.96	35.26%	52.13	19.79%	30.31	0.75	0,83
Households Appliances	Beauty	13.18%	5.61	33.12%	14.14	18.07%	7.91	0.50	0,49
Electronics and Computer Hardware	Accessories	10.38%	9.98	29.74%	11.47	18.55%	7.33	0.50	0,49
Electronics and Computer Hardware	Laptops and PCs	11.50%	8.67	28.34%	129.80	16.13%	77.04	0.55	0,84
Electronics and Computer Hardware	Monitors	7.69%	9.18	20.01%	29.64	10.79%	16.84	0.96	1,47
Electronics and Computer Hardware	Tablets and E-readers	9.93%	7.33	28.01%	67.71	13.59%	32.39	0.55	0,60
Electronics and Computer Hardware	Consoles	10.08%	10.07	25.05%	55.15	12.73%	28.22	0.41	0,40
Computer Games and Software	Software	11.74%	9.14	32.08%	67.40	17.00%	40.06	0.68	0,78
Computer Games and Software	PC games	12.63%	7.52	36.46%	10.63	21.04%	6.05	0.38	0,35
Computer Games and Software	Console games	11.04%	7.46	33.45%	12.04	19.06%	6.76	0.27	0,26
Total		11,2%	8.90	30.24%		16.53%		0.55	0.65

The results of the Durbin−Watson test

Durbin-Watson test

data: fit4

DW = 1.6737, p-value < 0.00000000000000022

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What Drives Price Dispersion in the European E-commerce Industry?

Data publikacji: 18 gru 2018

Zakres stron: 53 - 71

DOI: https://doi.org/10.1515/ceej-2017-0017

Słowa kluczowe
price dispersion, price discrimination, e-commerce, web-scraping, price comparison service

© 2017 Kristóf Gyódi, Maciej Sobolewski, Michał Ziembiński published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Fig. 1

Fig. A1

Fig. A2

Fig. A3

Fig. A4

Fig. A6

Fig. A5

Result of Levene’s Test for Homogeneity of Variance − Product Category Variables

Frequentist model averaging − relative variable importance

Result of the analysis of variance model − Product Category Variables

Result of analysis of variance model − Product Subcategory Variables

Results of linear regression 'percent.devation' variable for the

Descriptive statistics of price dispersion determinants in the EU countries

The number of products and observations in each product category

The number of products and observations for EU countries

Result of Levene’s Test for Homogeneity of Variance − Product Subcategory Variables

Result of analysis of variance model − Country Variables

The results of the Goldfeld−Quandt test

The results of the Breusch−Pagan test

Result of Levene’s Test for Homogeneity of Variance − Country Variables

Results of the VIF Test

List of variables used in regression analysis

The gross (retail) price dispersion in European e-commerce industry

The pre-tax price dispersion in European e-commerce industry (VAT excluded)

The results of the Durbin−Watson test

What Drives Price Dispersion in the European E-commerce Industry?

Data publikacji: 18 gru 2018

Zakres stron: 53 - 71

DOI: https://doi.org/10.1515/ceej-2017-0017

Słowa kluczoweprice dispersion, price discrimination, e-commerce, web-scraping, price comparison service

© 2017 Kristóf Gyódi, Maciej Sobolewski, Michał Ziembiński published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Fig. 1

Fig. A1

Fig. A2

Fig. A3

Fig. A4

Fig. A6

Fig. A5

Result of Levene’s Test for Homogeneity of Variance − Product Category Variables

Frequentist model averaging − relative variable importance

Result of the analysis of variance model − Product Category Variables

Result of analysis of variance model − Product Subcategory Variables

Results of linear regression 'percent.devation' variable for the

Descriptive statistics of price dispersion determinants in the EU countries

The number of products and observations in each product category

The number of products and observations for EU countries

Result of Levene’s Test for Homogeneity of Variance − Product Subcategory Variables

Result of analysis of variance model − Country Variables

The results of the Goldfeld−Quandt test

The results of the Breusch−Pagan test

Result of Levene’s Test for Homogeneity of Variance − Country Variables

Results of the VIF Test

List of variables used in regression analysis

The gross (retail) price dispersion in European e-commerce industry

The pre-tax price dispersion in European e-commerce industry (VAT excluded)

The results of the Durbin−Watson test

Słowa kluczowe
price dispersion, price discrimination, e-commerce, web-scraping, price comparison service