Niche Markets and Electronic Commerce
AbstractThis paper investigates e-commerce strategies when in addition to the price, firms can control the size of the market area. Due to the shape of the commercial costs (e.g. costs of the e-commerce activity) the following results emerge: 1) if the average costs of commercial are decreasing in the market area size, firms serve the entire market, 2) if the average costs are U-shaped firms decide to limit the market area, 3) the firm’s behaviour is socially optimal. The paper also analyses the quality of the web-service, the formation of trade areas and the role of transport costs.
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Bibliographic InfoPaper provided by KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy in its series KITeS Working Papers with number 147.
Length: 32 pages
Date of creation: Jul 2003
Date of revision: Jul 2003
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Find related papers by JEL classification:
- D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-10-20 (All new papers)
- NEP-COM-2003-10-20 (Industrial Competition)
- NEP-GEO-2003-10-20 (Economic Geography)
- NEP-IND-2003-10-20 (Industrial Organization)
- NEP-INO-2003-10-20 (Innovation)
- NEP-TID-2003-10-20 (Technology & Industrial Dynamics)
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.:
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