When deciding whether to introduce market competition into a regulated industry, a regulator faces an important tradeoff. Market-based prices can provide incentives to allocate resources more efficiently and reduce costs, but the presence of market power may lead to increased markups. We use a...

We study the pricing decision of firms in the presence of consumer inertia. Inertia can arise from habit formation, brand loyalty, switching costs, or search, and it has important implications for the interpretation of equilibrium outcomes and counterfactual analysis. In particular, consumer...

The U.S. residential real estate agency market presents a puzzle for economic theory: commissions on real estate transactions have remained high for decades even though entry is frequent and costs are low. We model the real estate agency market, and other brokered markets, as a game in which...

Increasingly, retailers have access to better pricing technology, especially in online markets. Firms employ automated pricing algorithms that allow for high-frequency price changes. What are the implications for price competition? We develop a model of price competition where firms can differ...