In January 2011, a price regulation was established in the Austrian gasoline market which prohibits firms from raising their prices more than once per day. Similar restrictions have been discussed in New York State and Germany. Despite their intuitive appeal, this article argues that...

Especially in many online markets, consumers can readily observe prices, but may need to further inspect products to assess their suitability. We study the effects of product differentiation and search costs on competition and market outcomes in a tractable model of price-directed consumer...

Manufacturers frequently resist heavy discounting of their products by retailers. Since low prices should increase demand and manufacturers could simply refuse to fund deep price promotions, such resistance is puzzling at first sight. We develop a model in which price promotions cause shoppers...

Consumers' willingness to pay for an identical product, e.g. as caused by differences in local income or tastes, may differ greatly across locations. Yet, while a large literature examines consumers' optimal price and product-search behavior under various market configurations, the equilibrium...

Diese Diplomarbeit befasst sich mit dem Phänomen der asymmetrischen Preistransmission, welches eine schnellere Reaktion von Verkaufspreisen auf positive Kostenschocks im Vergleich zu negativen Kostenschocks impliziert. Obwohl die Öffentlichkeit sowie Regierungsstellen asymmetrische...

In many markets, empirical evidence suggests that positive production cost shocks are transmitted more quickly and fully to final prices than negative ones. This article explains asymmetric price adjustment caused by firms imperfectly colluding on supra-competitive price levels. While positive...

This article proposes a new rationale for consumer search and mixed-strategy pricing: the presence of local market heterogeneities. In the model, two spatially separated markets, each home to an identical local monopolist, differ in size and their consumers' willingness to pay (e.g., as caused...

How should firms optimally choose prices and promotional strategies and how should they position their products when consumers are "relative thinkers"? We provide answers in a model that extends the seminal contributions of Varian (1980) and Narasimhan (1988) and derive both managerial...