We experimentally examine the effects of price competition in markets for expe-rience goods where sellers can build up reputations for quality. We compare price competition to monopolistic markets and markets where prices are exogenously fixed (somewhere between the endogenous oligopoly and...

We study mergers in a market where N firms sell a homogeneous good and consumers search sequentially to discover prices. The main motivation for such an analysis is that mergers generally affect market prices and thereby, in a search environment, the search behavior of consumers. Endogenous...

We present an oligopoly model where a certain fraction of consumers engage in costly non-sequential search to discover prices. There are three distinct price dispersed equilibria characterized by low, moderate and high search intensity, respectively. We show that the effects of an increase in...

We modify the paper of Stahl (1989) [Stahl, D.O., 1989. Oligopolistic pricing with sequential consumer search. American Economic Review 79, 700–12] by relaxing the assumption that consumers obtain the first price quotation for free. When all price quotations are costly to obtain, the unique...

This paper gives an overview and evaluates the literature on Microfoundations.<P> See also 'Microfoundations: A Critical Inquiry', Routledge, London, 1993 Reviewed in Economic Journal, 1994; De Economist, 1995; Journal of Economic Methodology, 1996; Economics and Philosophy, 1996).

This paper gives an overview and evaluates the literature on Microfoundations.<P>

Despite the mixed empirical evidence, many economists still hold to the view that Internet will promote competition between firms, thereby lowering prices and increasing economic welfare. This paper presents a search model that provides a different view. We analyze the market for a homogeneous...

This paper examines the effect of price matching guarantees (PMGs) on market outcomes in a sequential search model. PMGs are simultaneously chosen with prices and some consumers (shoppers) know the firms’ decisions before buying, while others (non-shoppers) enter a shop before observing the...

We experimentally examine the effects of flexible and fixed prices in markets for experience goods in which demand is driven by trust. With flexible prices, we observe low prices and high quality in competitive (oligopolistic) markets, and high prices coupled with low quality in non-competitive...

We study the effects of reputation and competition in a stylized market for experience goods. If interaction is anonymous, such markets perform poorly: sellers are not trustworthy, and buyers do not trust sellers. If sellers are identifiable and can, hence, build a reputation, efficiency...