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Part of this is defacto deregulation allowing suppliers to overcharge smaller stores with less purchasing power than big chains. (The policy not to enforce https://en.wikipedia.org/wiki/Robinson%E2%80%93Patman_Act).

Part of this is overregulation, with zoning and planning departments enacting policies that make smaller retail spaces less attractive to builders and owners, leading to a low supply, and allowing egregious rent for well located small retail.

Yes, economies of scale likely mean that larger businesses can afford lower prices, but smaller businesses also get to avoid some costs (no large administrative corporate departments necessary for a one-location bodega), so the prices probably don't need to be as far apart as they are.

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Why should the government have anything to say about price negotiations between producers and retailers of frozen pizzas?

Robinson-Patman is terrible law that’s more or less impossible to enforce equitably. So it hasn’t been.

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There's a full supermarket a 10 minute walk from me because it's a dense area.
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This is the ideal situation, and common in most west cost dense areas, but not true for every dense mixed use area. Specifically it's common in low-income high-density housing to not have sufficient super market coverage.
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Everybody does this, unless its 10pm on Saturday and you are thankfully kissing the hand of bodega owner for being open at such absurd hour
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All grocery stores close at 10 here (Ireland) but yes you are right. My local centra, 1km away is used for cheese, milk and beer runs. Everything else I get at the big lidl 15km away.
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