Working Paper: NBER ID: w17825
Authors: Emek Basker
Abstract: Barcodes and barcode scanners transformed the grocery industry in the 1970s. I use store-level data from the 1972, 1977, and 1982 Census of Retail Trade, matched to data on store scanner installations, to estimate scanners' effect on labor productivity. I find that early scanners increased a store's labor productivity, on average, by approximately 4.5 percent in the first few years. The effect was larger in stores carrying more packaged products, consistent with the presence of network externalities. Short-run gains were small relative to fixed costs, suggesting that the impediment to widespread adoption of the new technology was profitability, not coordination problems.
Keywords: barcode scanners; productivity; retail sector; technology adoption
JEL Codes: D22; L81; O33
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Installation of barcode scanners (L81) | Increase in labor productivity in supermarkets (J29) |
| Installation of barcode scanners (L81) | Increase in revenue per payroll dollar (J39) |
| Higher proportion of packaged products (L66) | Increase in impact of barcode scanners on labor productivity (F66) |
| Installation of barcode scanners (L81) | Reduction in labor demand (J23) |
| Installation of barcode scanners (L81) | Annual payroll savings (J32) |
| Year of scanner adoption (L96) | Smaller short-run productivity gains (O49) |
| Subsequent years (Y20) | Sustained increase in productivity (O49) |