We study price formation in the standard model of consumer search for differentiated products but allow for search cost … important but often neglected aspect of the price mechanism. Recognizing the role the equilibrium price plays in consumers …

overvalues a product attribute - quality or price - that stands out in a particular choice situation. In a highly competitive low-price … environment like on an online platform, consumers focus more on price rather than quality. Especially if the market power of local … (physical) retailers is low, price tends to be salient also in the local store, which is unfavorable for the high …

of price sensitive consumers, the higher the pass-through rate. Second, there is a hump-shaped relationship between the … changes to diesel and gasoline prices using a unique dataset containing the universe of price changes at fuel stations in … Germany and France and a synthetic difference-in-differences strategy. Our empirical results are in line with our theoretical …

Partly motivated by the recent antitrust investigations concerning Google, we develop a leverage theory of tying in two …. Tying provides a mechanism to circumvent the non-negative price constraint in the tied product market without inviting an … aggressive response as the rival firm faces the non-negative price constraint. We identify conditions under which tying in two …

find that prices have a negative impact on transitions in the sense that an increase in the brand price will reduce the … transition from generics to brand and likewise an increase in the generic price will reduce the transition from brand to generics …

How do households adjust their spending behavior in response to changes in home price expectations? We conduct a field … experiment with a sample of Americans that links survey data on home price expectations to actual spending behaviour as measured … in a rich home-scanner dataset. In the experiment we exogenously vary households' home price expectations by providing …