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Dr. Justin Leung
Assistant Professor of Economics
National University of Singapore

This paper documents an increase in household concentration in the US retail sector from 2004-2019. Despite a growing number of stores, households visit fewer stores, do more one-stop shopping, and increasingly shop at different retailers from each other. We find that the increasing availability of superstar retailers, rises in product variety within stores, and increases in households’ opportunity cost of time contribute to these trends. We develop a model that can rationalize these results. Our calibrated model shows that household concentration is tightly linked to markups and that its rise led to a 5 percentage point increase in aggregate markups.