Electronic Commerce, Consumer Search And Retailing Cost Reduction
AbstractThis paper explains three things in a unified way. First, how e-commerce can generate price equilibria, where physical shops either compete with virtual shops for consumers with Internet access, or alternatively, sell only to consumers with no Internet access. Second, how these price equilibria might involve price dispersion on-line. Third, why prices may be higher on-line. For this purpose we develop a model where e-commerce: reduces consumers’ search costs, involves trade-offs for consumers, and reduces retailing costs.
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Bibliographic InfoPaper provided by Universidad Carlos III, Departamento de Economía in its series Economics Working Papers with number we016722.
Date of creation: Dec 2001
Date of revision:
Other versions of this item:
- Cristina Mazón & Pedro Pereira, 2001. "Electronic commerce, consumer search and reailing cost reduction," Documentos del Instituto Complutense de AnÃ¡lisis EconÃ³mico 0102, Universidad Complutense de Madrid, Facultad de Ciencias Económicas y Empresariales.
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- O - Economic Development, Technological Change, and Growth
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