Fluctuating oil prices drive geographic price differences, impacting consumer wallets.
The prices of products vary over time and in different places. Factors like oil prices, real income, and tax rates play a big role in this variation. In regions where markets are connected, oil prices have a big impact on price differences. In regions where markets are separate, differences in real income are more important. Taxes also affect how prices change in different areas. This study shows that these factors all contribute to why prices are different in different places and times.