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Beyond the Cost of Price Adjustment : Investments in Pricing Capital

Zbaracki, Mark; Bergen, Mark; Dutta, Shantanu; Levy, … - 2010

provocative implication of the new theory of pricing, however, is that the allocative efficiency of the price system itself may be …

Persistent link: https://www.econbiz.de/10014028006

Product Rankings, AI Pricing Algorithms, and Collusion

Qiu, Liying; Huang, Yan; Singh, Param Vir - 2022

Reinforcement learning (RL) based pricing algorithms have been shown to tacitly collude to set supra-competitive prices in oligopoly models of repeated price competition. We investigate the impact of ranking systems, a common feature of online marketplaces, on algorithmic collusion in prices. We...

Persistent link: https://www.econbiz.de/10014030633

Regulatory Pricing Rules to Neutralize Network Dominance

Economides, Nicholas; Lopomo, Giuseppe; Woroch, Glenn A. - 2008

This paper evaluates the effectiveness of several pricing rules intended to promote entry into a network industry … interconnected networks. In a symmetric equilibrium, the price of cross-network calls exceeds the price of internal calls. This … "calling circle discount" tends to "tip" the industry to a monopoly equilibrium as would a network externality. By equalizing …

Persistent link: https://www.econbiz.de/10014030714

Bundling and Competition for Slots : Sequential Pricing

Jeon, Doh-Shin - 2009

In this paper we study, as in Jeon-Menicucci (2009), competition between sellers when each of them sells a portfolio of distinct products to a buyer having limited slots. This paper considers sequential pricing and complements our main paper (Jeon- Menicucci, 2009) that considers simultaneous...

Persistent link: https://www.econbiz.de/10013155785

Menu Costs and Sale Strategies of Multiproduct Retailers

Chung, Barick - 2013

In a typical sale model, retailers compete for informed consumers by changing prices in every period. Thus, if menu costs resist price adjustments, they prevent not only prices from equilibrating demands and supplies, but also retailers' competition. I investigate the effects of menu costs on...

Persistent link: https://www.econbiz.de/10013082118

The Freemium Pricing Strategy and the Opportunity Cost of Time

Cai, Gaoyang; Spulber, Daniel F. - 2023

Firms are using freemium pricing strategies in many industries, including software, mobile apps, games, and streaming music and video. Freemium combines free services supported by advertising with premium services supported by subscriptions. We obtain the firm's optimal pricing strategy when...

Persistent link: https://www.econbiz.de/10014344018

Nonlinear Pricing and Misallocation

Bornstein, Gideon; Peter, Alessandra - National Bureau of Economic Research - 2024

This paper studies the effect of nonlinear pricing on markups and misallocation. We develop a general equilibrium model of firms that are allowed to set a quantity-dependent pricing schedule--contrary to the typical assumption in macroeconomic models. Without the restriction to linear pricing,...

Persistent link: https://www.econbiz.de/10015145095

Measuring Markups with Revenue Data

Kirov, Ivan; Traina, James - 2021

Standard production-based markup estimators are biased and inconsistent when output prices are unobserved. Absent additional assumptions, researchers cannot disentangle whether firms have higher revenues because of higher productivity or higher markups. We propose a method that generates...

Persistent link: https://www.econbiz.de/10013214195

Optimal Pricing of a Product Diffusing in Rich and Poor Populations

Hartl, R. F. - 2009

We consider a market consisting of two populations, termed rich and poor for convenience. If a product is priced such that it is very expensive for the poor, but affordable to the rich, then it becomes a status symbol for the poor and this makes it more desirable for the poor. At a lower price,...

Persistent link: https://www.econbiz.de/10013158791

Bundling and joint marketing by rival firms

Jeitschko, Thomas D.; Jung, Yeonjei; Kim, Jaesoo - 2014

We study joint marketing arrangements by competing firms who engage in price discrimination between consumers who patronize only one firm (single purchasing) and those who purchase from both competitors (bundle purchasers). Two types of joint marketing are considered. Firms either commit to a...

Persistent link: https://www.econbiz.de/10010350971