We asses price dispersion in retail markets and its sources over time. Using aproduct-detailed price database, we document a consistent divergence of prices overtime in retail markets in Uruguay: price dispersion increased 3.1% in fifteen years.Next, we analyze microeconomic and macroeconomic factors that correlate withprice dispersion. We differentiate the effect in the short-run—i.e., static differencesbetween markets—and long-run effects—if these effects increase or decrease overtime. Macroeconomic factors seem to fluctuate over time in their effect on pricedispersion. Microeconomic factors, mainly competition between stores and differencesin category assortments between stores, have a substantial short-run correlation, andan increase effect in time. When we add interactions to the trend, our measure ofprice dispersion, we found that price dispersion is twice larger: 6.3%.