Firms' strategies for reducing the effectiveness of the consumer price search
Ireland, Norman J. (2002) Firms' strategies for reducing the effectiveness of the consumer price search. Working Paper. Coventry: University of Warwick, Department of Economics. Warwick economic research papers (No.627).
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This paper considers a simple model of competition based on some buyers making price comparisons between two suppliers. The difficulties of making appropriate comparisons are made greater by exclusive dealer agreements and restrictions, and by suppliers trading under more than one name. It is argued that suppliers will set prices using mixed strategies, and that prices become less competitive as price comparisons become more difficult. The implications for competition policy are considered in the light of recent judgements of the UK’s Office of Fair Trading and the European Court of Justice.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HC Economic History and Conditions
H Social Sciences > HF Commerce
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||Great Britain. Office of Fair Trading, Court of Justice of the European Communities, Competition, Monopolies, Consumer behavior, Profiteering|
|Series Name:||Warwick economic research papers|
|Publisher:||University of Warwick, Department of Economics|
|Place of Publication:||Coventry|
|Official Date:||21 January 2002|
|Number of Pages:||28|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Open Access|
Arnold, M.A., 2000, Costly search, capacity constraints and Bertrand equilibrium price dispersion, International Economic Review, 41, 117-131.
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