Bar Codes Lead to Frequent Deliveries and Superstores

This paper explores the consequences of new information technologies, such as bar codes and computer-tracking of inventories, for the optimal organization of retail. The first result is that there is a complementarity between the new information technology and frequent deliveries. This is consistent with the recent move in the retail sector toward higher-frequency delivery schedules. The second result is that adoption of the new technology tends to increase store size. This is consistent with recent increases in store size and the success of the superstore model of retail organization. 1 I am grateful to Joseph Harrington and the referees for detailed comments that led to a substantial improvement of the paper. The views expressed herein are those of the author and not necessarily those of the Federal Reserve Bank of Minneapolis or the Federal