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In product markets, there exists substantial dispersion in prices for transactions of physically identical goods, and incumbent sellers sell at higher prices than entrants. This study develops a theory of dynamic pricing that explains these facts as results from the same fundamental friction:...
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We investigate the effect of competition on price dispersion in the airline industry. Using panel data from 1993 to … 2008, we find a non-monotonic effect of competition on price dispersion. An increase in competition is associated with …
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We study the optimal behaviour of a cartel faced with fringe competition and imperfectly attentive consumers …
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dispersion increases with competition. We find that competition has a negative effect on price dispersion, in line with the … textbook treatment of price discrimination. Specifically, the effects of competition on price dispersion are most significant … routes with a more homogenous customer base, the effects of competition on price discrimination are largely insignificant. We …
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This note presents necessary conditions for non-degenerate price dispersion in a continuous atomistic market where buyers with price-elastic demand search sequentially for the lowest price, and firms maximize profit subject to a variable average cost function
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COVID-19 has caused substantial disruptions to the airline industry. This paper analyzes the effects of competition … dispersion during COVID-19 and a positive relationship between competition and dispersion. These results are robust to …
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