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dc.contributor.authorAsplund, Marcusen_US
dc.contributor.authorFriberg, Richarden_US
dc.contributor.authorWilander, Fredriken_US
dc.description.abstractWhile many studies have documented deviations from the Law of One Price in international settings, evidence is scarce on the extent to which consumers take advantage of price differentials and engage in cross border shopping. We use data from 287 Swedish municipalities to estimate how responsive alcohol sales are to foreign prices, and relate the sensitivity to the location's distance to the border. Typical results suggest that the elasticity with respect to the foreign price is around 0.4 in the border region; moving 200 (400) kilometers inland reduces it to 0.2 (0.1). Given that cross country price differences for alcohol and other products are often caused by taxes, our evidence has implications for the debate on tax competition/harmonization.en_US
dc.publisherEkonomiska Forskningsinst. Stockholmen_US
dc.relation.ispartofseriesSSE/EFI Working Paper Series in Economics and Finance 587en_US
dc.subject.keywordLaw of one priceen_US
dc.subject.keywordtax competitionen_US
dc.subject.keywordtax harmonizationen_US
dc.subject.keywordcross border shoppingen_US
dc.subject.keywordEuropean integrationen_US
dc.subject.stwGrenzüberschreitender Verkehren_US
dc.subject.stwInternationaler Preiszusammenhangen_US
dc.subject.stwArbitrage Pricingen_US
dc.subject.stwAlkoholisches Getränken_US
dc.titleDemand and distance: Evidence on cross-border shoppingen_US
dc.typeWorking Paperen_US
Appears in Collections:SSE/EFI Working Paper Series in Economics and Finance, EFI - The Economic Research Institute, Stockholm School of Economics

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