Nermuth, M and Pasini, G and Pin, P and Weidenholzer, S (2009) Price Dispersion, Search Externalities, and the Digital Divide. UNSPECIFIED. University of Vienna Economics Papers 0916.
Nermuth, M and Pasini, G and Pin, P and Weidenholzer, S (2009) Price Dispersion, Search Externalities, and the Digital Divide. UNSPECIFIED. University of Vienna Economics Papers 0916.
Nermuth, M and Pasini, G and Pin, P and Weidenholzer, S (2009) Price Dispersion, Search Externalities, and the Digital Divide. UNSPECIFIED. University of Vienna Economics Papers 0916.
Abstract
We propose a model of price competition where consumers exogenously differ in the number of prices they compare. Our model can be interpreted either as a non?sequential search model or as a network model of price competition. We show that i) if consumers who previously just sampled one firm start to compare more prices all types of consumers will expect to pay a lower price and ii) if consumers who already sampled more than one price sample (even) more prices then there exists a threshold ?the digital divide? such that all consumers comparing fewer prices than this threshold will expect to pay a higher price whereas all consumers comparing more prices will expect to pay a lower price than before.
Item Type: | Monograph (UNSPECIFIED) |
---|---|
Subjects: | H Social Sciences > HB Economic Theory |
Divisions: | Faculty of Social Sciences Faculty of Social Sciences > Economics, Department of |
SWORD Depositor: | Unnamed user with email elements@essex.ac.uk |
Depositing User: | Unnamed user with email elements@essex.ac.uk |
Date Deposited: | 27 Jun 2012 15:11 |
Last Modified: | 16 May 2024 18:55 |
URI: | http://repository.essex.ac.uk/id/eprint/2633 |