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Competition and Price Dispersion in the U.S. Airline Industry

Borenstein, Severin - 1991

This papers analyzes dispersion in the prices that an airline charges to different customers on the same route. Such variation in airlines fares is substantial: the expected absolute difference in fares between two of an airline's passengers on a route averages thirty-six percent of the...

Persistent link: https://www.econbiz.de/10012475215

Dynamic Oligopoly Pricing with Asymmetric Information : Implications for Horizontal Mergers

Sweeting, Andrew; Tao, Xuezhen; Yao, Xinlu - National Bureau of Economic Research - 2021

We model differentiated product pricing by firms that possess private information about serially-correlated state variables, such as their marginal costs, and can use prices to signal information to rivals. In a dynamic game, signaling can raise prices significantly above static complete...

Persistent link: https://www.econbiz.de/10012496143

Markups and Entry in a Circular Hotelling Model

Barro, Robert J. - National Bureau of Economic Research - 2024

The Hotelling locational model and its adaptations to a circular city provide a core framework for research in industrial organization. The present paper expands the explanatory power of this model by incorporating a continuum of consumers with constant-elasticity demand functions along with...

Persistent link: https://www.econbiz.de/10014635623

A Model of Add-on Pricing

Ellison, Glenn - 2003

This paper examines a competitive model of add-on pricing, the practice of advertising low prices for one good in hopes of selling additional products (or a higher quality product) to consumers at a high price at the point of sale. The main conclusion is that add-on pricing softens price...

Persistent link: https://www.econbiz.de/10012468977

Price and Capacity Competition

Acemoglu, Daron - 2006

We study the efficiency of oligopoly equilibria in a model where firms compete over capacities and prices. The … demands across the firms. We first establish the existence of pure strategy subgame perfect equilibria (oligopoly equilibria … oligopoly equilibria of this game can be arbitrarily low. However, if the best oligopoly equilibrium is selected (among multiple …

Persistent link: https://www.econbiz.de/10012465855

A Dynamic Oligopoly with Collusion and Price Wars

Fershtman, Chaim - 1999

Most of the theoretical work on collusion and price wars assumes identical firms and an unchanging environment, assumptions which are at odds with what we know about most industries. Further that literature focuses on the impact of collusion on prices. Whether an industry can support collusion...

Persistent link: https://www.econbiz.de/10012471871

Dynamic Price Competition with Capacity Constraints

Betancourt, Jose M.; Hortaçsu, Ali; Öry, Aniko; … - National Bureau of Economic Research - 2024

We study dynamic price competition between sellers offering differentiated products with limited capacity and a common sales deadline. In every period, firms simultaneously set prices, and a randomly arriving buyer decides whether to purchase a product or leave the market. Given remaining...

Persistent link: https://www.econbiz.de/10014635636

International Shocks and Domestic Prices : How Large Are Strategic Complementarities?

Amiti, Mary - 2016

How strong are strategic complementarities in price setting across firms? In this paper, we provide a direct empirical estimate of firm price responses to changes in prices of their competitors. We develop a general framework and an empirical identification strategy to estimate the elasticities...

Persistent link: https://www.econbiz.de/10012456555

A Dynamic Model of Price Discrimination and Inventory Management at the Fulton Fish Market

Graddy, Kathryn - 2009

We estimate a dynamic profit-maximization model of a fish wholesaler who can observe consumer characteristics, set individual prices, and thus engage in third-degree price discrimination. Simulated prices and quantities from the model exhibit the key features observed in a set of high quality...

Persistent link: https://www.econbiz.de/10012463630

Spatial Price Discrimination with Heterogeneous Firms

Vogel, Jonathan - 2009

In this paper we present and solve a three-stage game of entry, location, and pricing in a spatial price discrimination framework with arbitrarily many heterogeneous firms. We provide a unique characterization of all equilibria without imposing restrictions on the distribution of marginal costs

Persistent link: https://www.econbiz.de/10012463671

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