In this paper, we first develop a game theoretic model of price competition between a pure play e-tailer and a bricks-and-clicks e-tailer. We show that in general, the pure play e-tailer has a lower equilibrium price. We then develop a simultaneous equation model of e-tailer price and traffic...

Despite claims that electronic commerce lowers search costs dramatically, and therefore makes it easy for consumers to spot the best buy, empirical studies have found a substantial degree of price dispersion in electronic markets for consumer goods. This study investigates the consumer welfare...