Data on memory modules sales are used to explore aspects of e-retail
demand. Aggregate sales are examined in state-level regressions.
Discrete choice techniques are used to examine (incomplete) hourly
sales data from a price comparison site. We find a strong relationship
between e-retail sales to a given state and sales tax rates that apply
to purchases from offline retailers, suggesting substantial online-offline
substitution and the importance of tax avoidance motives.
Geography matters in two ways: consumers prefer purchasing from
firms in nearby states and appear to have a separate preference for
buying from in-state firms. (JEL D12, H25, H71, L81)
Ellison, Glenn, and Sara Fisher Ellison.
"Tax Sensitivity and Home State Preferences in Internet Purchasing."
American Economic Journal: Economic Policy,
Consumer Economics: Empirical Analysis
Business Taxes and Subsidies including sales and value-added (VAT)
State and Local Taxation, Subsidies, and Revenue
Retail and Wholesale Trade; e-Commerce