Matched Model price indexes are generally thought to over-estimate the quality-adjusted price level. This bias stems from the fact that only a fraction of the models are sold in consecutive sampling periods and that the price/performance ratio of these models is worse than that of new models....

Using a high frequency data-set of advertised prices in the personal computer industry, we find that firms which introduced Pentium computers late in the "buy Direct" segment of the market command a higher price premium compared to early entrants. This is true even among firms which have the...

We examine the rate of convergence to efficiency in the buyer?s bid double auction for sequences of markets in which the number m of buyers can be arbitrarly larger than the number n of sellers. This rate is shown to be O(n/m2) when m, n are such that m*_ for a constant _ 1. This is consistent...

In a duopoly model of horizontal and vertical differentiation, where consumers are ex-ante unaware of product qualities, we study the firms' incentives to signal quality via prices. Consumers, after they observe prices, can evaluate a firm's product quality before purchase if they incur a search...