Implications of Improved Information on Market Performance

Abstract

The retail food market in Edmonton, Alberta represents an unusual market to study. The basic problem inherent in this metropolitan market area of 500,000 people, is the dominance of a single retail food chain whose food sales represent up to 65 percent of total food sales.Conventional economic theory would normally lead to the conclusion that market performance would be improved by a direct attack on the structure of the market which in turn would involve the absolution of a highly successful retail operation. However, the application of monopoly anti‐trust laws was certainly not an alternative available to the research team, even if it was considered to be a feasible solution to the problem. Therefore an attempt was made by the authors to observe the impact of improved consumer market information on corporate performance.The following article documents the research and leads towards a time honored conclusion that additional market information would improve consumer welfare in a meaningful manner.