This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Introductory Price as a Signal of Cost in a Model of Repeat Business

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Bagwell, Kyle

Additional information is available for the following registered author(s):

Abstract

This paper analyzes a bargaining model with incomplete information in which the time between offers is an endogenous stra tegic variable. It finds equilibria involving a delay to agreement th at is attributable to the use of strategic time delay by bargainers t o signal their relative strength. Under some specifications of the pa rameters, delay is present in the unique sequential equilibrium whose beliefs satisfy one intuitive restriction. This delay does not vanis h as the minimal time between offers becomes small. Copyright 1987 by The Review of Economic Studies Limited.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://links.jstor.org/sici?sici=0034-6527%28198707%2954%3A3%3C365%3AIPAASO%3E2.0.CO%3B2-Q&origin=bc
File Format: application/pdf
File Function: full text
Download Restriction: Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Article provided by Blackwell Publishing in its journal Review of Economic Studies.

Volume (Year): 54 (1987)
Issue (Month): 3 (July)
Pages: 365-84
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:bla:restud:v:54:y:1987:i:3:p:365-84

Contact details of provider:
Web page: http://www.blackwellpublishing.com/journal.asp?ref=0034-6527

Order Information:
Web: http://www.blackwellpublishing.com/subs.asp?ref=0034-6527

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Other versions of this item:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law & Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
  2. Bagwell, Kyle, 1987. "Introductory Price as a Signal of Cost in a Model of Repeat Business," Review of Economic Studies, Blackwell Publishing, vol. 54(3), pages 365-84, July. [Downloadable!] (restricted)
    Other versions:
  3. Shilony, Yuval, 1977. "Mixed pricing in oligopoly," Journal of Economic Theory, Elsevier, vol. 14(2), pages 373-388, April. [Downloadable!] (restricted)
  4. Sobel, Joel, 1984. "The Timing of Sales," Review of Economic Studies, Blackwell Publishing, vol. 51(3), pages 353-68, July. [Downloadable!] (restricted)
  5. Conlisk, John & Gerstner, Eitan & Sobel, Joel, 1984. "Cyclic Pricing by a Durable Goods Monopolist," The Quarterly Journal of Economics, MIT Press, vol. 99(3), pages 489-505, August. [Downloadable!] (restricted)
  6. Kyle Bagwell & Garey Ramey, 1987. "Advertising and Limit Pricing," Discussion Papers 729, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  7. Irvine, F Owen, Jr, 1981. "An Optimal Middleman Firm Price Adjustment Policy: The "Short-Run Inventory-Based Pricing Policy."," Economic Inquiry, Oxford University Press, vol. 19(2), pages 245-69, April.
  8. Varian, Hal R, 1980. "A Model of Sales," American Economic Review, American Economic Association, vol. 70(4), pages 651-59, September. [Downloadable!] (restricted)
  9. Bagwell, Kyle, 1990. "Informational product differentiation as a barrier to entry," International Journal of Industrial Organization, Elsevier, vol. 8(2), pages 207-223, June. [Downloadable!] (restricted)
    Other versions:
  10. Milgrom, Paul & Roberts, John, 1986. "Price and Advertising Signals of Product Quality," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 796-821, August. [Downloadable!] (restricted)
    Other versions:
  11. Salop, Steven, 1977. "The Noisy Monopolist: Imperfect Information, Price Dispersion and Price Discrimination," Review of Economic Studies, Blackwell Publishing, vol. 44(3), pages 393-406, October. [Downloadable!] (restricted)
  12. Green, Edward J & Porter, Robert H, 1984. "Noncooperative Collusion under Imperfect Price Information," Econometrica, Econometric Society, vol. 52(1), pages 87-100, January. [Downloadable!] (restricted)
    Other versions:
  13. Diamond, Peter A., 1971. "A model of price adjustment," Journal of Economic Theory, Elsevier, vol. 3(2), pages 156-168, June. [Downloadable!] (restricted)
  14. Kreps, David M & Wilson, Robert, 1982. "Sequential Equilibria," Econometrica, Econometric Society, vol. 50(4), pages 863-94, July. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Kyle Bagwell & Garey Ramey, 1987. "Advertising and Limit Pricing," Discussion Papers 729, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  2. Kyle Bagwell & Michael Riordan, 1986. "Equilibrium Price Dynamics for an Experience Good," Discussion Papers 705, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  3. Vanessa von Schlippenbach, 2008. "Complementarities, Below-Cost Pricing, and Welfare Losses," Discussion Papers of DIW Berlin 788, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  4. Kyle Bagwell, 1993. "Dynamic Retail Price and Investment Competition," Discussion Papers 1115, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  5. Kyle Bagwell & Garey Ramey, 1990. "Advertising and Coordination," Discussion Papers 903, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  6. Srihari Govindan & Robert Wilson, 2008. "On Forward Induction," Levine's Working Paper Archive 122247000000001859, David K. Levine. [Downloadable!]
    Other versions:
  7. Mariano Tommasi, 1992. "Intertemporal Pricing in Search Markets, Customer Markets and Price Rigidity," UCLA Economics Working Papers 681, UCLA Department of Economics. [Downloadable!]
  8. Kyle Bagwell, 1987. "Introductory Price as a Signal of Cost in a Model of Repeat Business," Discussion Papers 722, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  9. Kyle Bagwell & Michael Peters, 1988. "Dynamic Monopoly Power When Search is Costly," Discussion Papers 772, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  10. Judith A. Chevalier & Anil K Kashyap & Peter E. Rossi, 2003. "Why Don't Prices Rise During Periods of Peak Demand? Evidence from Scanner Data," American Economic Review, American Economic Association, vol. 93(1), pages 15-37, March. [Downloadable!]
    Other versions:
  11. Luis Cabral, 2007. "Lock in and Switch: Asymmetric Information and New Product Diffusion," Working Papers 07-11, New York University, Leonard N. Stern School of Business, Department of Economics. [Downloadable!]
  12. Govindan, Srihari & Wilson, Robert B., 2008. "Decision-Theoretic Forward Induction," Research Papers 1986, Stanford University, Graduate School of Business. [Downloadable!]
  13. Kyle Bagwell & Garey Ramey, 1988. "Advertising, Coordination, and Signaling," Discussion Papers 787, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
Statistics
Access and download statistics

Did you know? There are over 21000 authors registered on RePEc Author Service.

This page was last updated on 2009-11-22.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.