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PRICE EFFECTS OF SHOPPING HOURS REGULATION: EVIDENCE FROM GERMANY

Authors


Karthik Reddy is a Deutscher Akademischer Austauschdienst research fellow at the Freie Universität Berlin (karthikreddy@zedat.fu-berlin.de).

Abstract

This article investigates the price effects of shopping hours legislation in order to evaluate empirically the theoretical argument that such regulations protect consumers from price increases. The paper first provides a review of the literature; it then analyses the data prior to and following the liberalisation of German shopping hours regulations in 2006 and 2007 in order to estimate the effects of these changes. The article finds that liberalisation resulted in a fall in prices. This conclusion adds to a growing body of literature suggesting that shopping hours regulations entail significant economic costs.

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