(Why) do prices and inflation rates differ within the euro area? We study the relevance of a national border for grocery prices in the otherwise homogenous and highly integrated border region of Austria and Germany. Using transaction data on prices and quantities from a large household panel, we...

Zunehmend nutzen Unternehmen gegenüber Verbrauchern die algorithmische Preisdiskriminierung als Preisstrategie. Preise werden hier in Abhängigkeit von der Zahlungsbereitschaft der Kunden autonom ohne menschliche Kontrollinstanz gebildet. Es handelt sich um eine klassische Querschnittsmaterie...

We analyze the effect of different pricing schemes on horizontally differentiated firms' ability to sustain collusion when customers have the possibility to combine (or mix) products to achieve a better match of their preferences. To this end, we compare two-part tariffs with linear prices and...

This paper studies static rational inattention problems with multiple actions and multiple shocks. We solve for the optimal signals chosen by agents and provide tools to interpret information processing. By relaxing restrictive assumptions previously used to gain tractability, we allow agents...

Some studies have examined ticket sales in the context of a sporting event. However, only a few have investigated the determinants of ticket prices, and, to date, none have done so in the context of a multidisciplinary sports mega-event. This study examines this complex paradigm through the case...

An imperfectly-informed regulator needs to procure multiple units of some good (e.g., green energy, market liquidity, pollution reduction, land conservation) that can be produced with heterogeneous technologies at various costs. How should she optimally procure these units? Should she run...

Brokesova, Deck and Peliova [Int. J. Ind. Organ. 37 (2014) 229-237] have shown that comparative static results from two-period behavior-based pricing models hold in laboratory experiments, but they observed significant differences from point predictions. We report findings in conformity with...

We report an experiment contrasting the impacts of a tax and a cap rule in a single-product market with two privately-informed buyers. We discuss the effects on choice set and consumer surplus. The policy environment varies across treatments. With regulations, we aim to halve the size of the...

We analyze the effects of commodity taxation in markets where suppliers implement second-degree price discrimination schemes, such as offering different package sizes and quality-differentiated versions of the same product. In these markets, suppliers distort the quantity (or quality) intended...

Emerging tracking data allow precise predictions of individuals' reservation values. However, firms are reluctant to conspicuously implement personalized pricing because of concerns about consumer and regulatory reprisals. This paper proposes and applies a method which disguises personalized...

We discuss the effect of personalized pricing on profits and welfare in a Hotelling model in which consumers can simultaneously purchase from both firms. As the additional gain from the second purchase increases, personalized pricing is more likely to harm (resp., benefit) consumers (resp.,...

Policy makers use reference pricing to curb pharmaceutical expenditures by reducing coverage of expensive branded drugs. In a theoretical analysis we show that the net effect of reference pricing is generally ambiguous when accounting for entry by generic producers. Reference pricing shifts...

Personalized pricing has become a reality through digitization. We examine firms' incentives to adopt one of the three pricing schemes: uniform, personalized, or group pricing in a Hotelling duopoly model. There are two types of consumer groups that are heterogeneous in their mismatch costs. We...

We examine tippy network markets that accommodate price discrimination. The analysis shows that when a mild equilibrium refinement, the monotonicity criterion, is adopted, network competition may have a unique subgame-perfect equilibrium regarding the winner's identity; the prevailing brand may...

This study investigates mixed markets in which a social welfare-maximizing public firm and a private firm engage in behavior-based price discrimination (BBPD). Total of two cases are considered: one where domestic shareholders completely own the private firm and one where foreign shareholders...

We analyze self- and joint procurement of countries with heterogeneous demand for a good offered by a price discriminating monopolist. We find that not only countries with low but also with high demand can benefit from committing to jointly procure equal quantities at a uniform price, even if...

Bank market power shapes firm investment and financing dynamics and hence affects the transmission of macroeconomic shocks. Motivated by a secular increase in the concentration of the US banking industry, I study bank market power through the lens of a dynamic general equilibrium model with...

We consider a model where for-profit providers compete in quality in a price-regulated market that has been opened to competition, and where the incumbent is located at the center of the market, facing high costs of relocation. The model is relevant in markets such as public health care,...

Whether input suppliers charge customized (discriminatory) or industry-wide (uniform) prices affects downstream manufacturers' incentives to innovate. This paper investigates the implications of input price discrimination when an upstream monopolist commits to prices before downstream firms make...

A monopolistic seller is marketing a good to a customer whose willingness to pay is determined by both his private type and the “quality.” The seller can design a menu of both prices and experiments - that reveal information about quality. We show that the optimal mechanism features both...

The third-degree price discrimination theory charges a lower price to a more elastic demand. This paper unveils an unpleasant result of such theory: the lower price comes with less quantity. This paper further reveals the true meaning of elasticity pricing

An incumbent supplier can use exclusive dealing contracts with buyers to prevent entry of an efficient rival when those contracts include an agreement over price. The linear price in the unique exclusionary equilibrium is above (below) the incumbent’s variable cost when buyers compete over...