While e-commerce is driving retailers to change prices more frequently, it is also leading to more uniform pricing across online and offline retailers.

A paper by Alberto Cavallo of Harvard University found evidence that the algorithms used by internet-based retail giants like Amazon to constantly change and adjust prices have led to greater price fluctuations in response to various macroeconomic shocks. This so-called ‘Amazon Effect’ not only forces brick-and-mortar outlets to respond in a similar manner but also
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The influence of a growing online retail industry increases consumers’ exposure to the fluctuations of energy prices and exchange rates.

According to Harvard Business School professor Alberto Cavallo, e-commerce is flatlining competition.

Prices for groceries sold by Walmart vary less from one store to another when Amazon markets the same references.

Amazon Effect: researcher claims web giant’s low prices keep inflation in check

Retailers adjusting prices more frequently and uniformly across locations should react faster to economic shocks, shows a recent study

Competition between Amazon and traditional retailers is causing prices to become more uniform