Fading choice: transport costs and variety in consumer goods
利用埃塞俄比亚城镇和村庄的132种消费品及800多个品牌数据,研究发现偏远村庄的消费品多样性显著减少,运输成本上升导致品种减少和价格上升,忽视这些成本会低估偏远地区的贫困程度。
Abstract We examine the spatial variation in variety of manufactured consumer goods to study how choice fades across space. We use data on 132 consumer goods and over 800 brands available from a purpose‐designed survey of fixed shops and periodic market stalls in towns and villages in Ethiopia. We find that local consumer choice fades, with fewer varieties in remoter villages. On average, these villages have approximately half the number of available items compared to their nearest market town. A fall in travel time of a half‐hour is associated with 4 extra goods and 9 brands. Variety also increases with inequality and market size. Furthermore, we estimate a model of heterogeneous consumers with a preference for variety and monopolistically competitive traders to disentangle the role of transport costs from the taste for variety, and to assess the consequences for prices. Our model estimates suggest that local consumer prices contain a markup of 8% above source town prices and transport costs. We demonstrate the significant costs to consumers from both low variety and high trade costs. Ignoring such costs means that poverty is underestimated in remote places. In turn, when infrastructure investments raise variety, the likely fall in poverty will be underestimated too.