Lack of Uniform Prices or Lack of Uniform Retailers?

Standard models assume uniform pricing across stores (DellaVigna and Gentzkow 2019). We show that uniform pricing varies across products within food categories. Even when product-chain prices are nearly uniform, cross-market differences in retailer and product composition generate spatial dispersion in effective price levels. Poorer metropolitan statistical areas are served by fewer chains, have a higher share of large national retailers, and exhibit lower product variety across and within retailers. Ignoring this heterogeneity understates price-level gaps between poor and rich areas. These results complement Kim and Navarrete (2025), who identify retail market structure as a key driver of spatial inflation heterogeneity.