Risk Attitudes and Internet Search Engines: Theory and Experimental Evidence
AbstractThis paper analyzes the impact on consumer prices of the size and biases of price comparison search engines. We develop several theoretical predictions, in the context of a model related to Burdett and Judd (1983) and Varian (1980), and test them experimentally. The data supports the model’s predictions regarding the impact of the number of firms, and the type of bias of the search engine. The data does not support the model’s predictions regarding the impact of the size of the search engine. We identified several data patterns, and developed an econometric model for the price distributions. Variables accounting for risk attitudes improved significantly the explanatory power of the econometric model.
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Bibliographic InfoPaper provided by NET Institute in its series Working Papers with number 04-03.
Length: 56 pages
Date of creation: Oct 2004
Date of revision: Oct 2004
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Web page: http://www.NETinst.org/
Search engines; incomplete information; biased information; price levels; experiments;
Find related papers by JEL classification:
- 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
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-08-26 (All new papers)
- NEP-EXP-2006-08-26 (Experimental Economics)
- NEP-ICT-2006-08-26 (Information & Communication Technologies)
- NEP-MIC-2006-08-26 (Microeconomics)
- NEP-MKT-2006-08-26 (Marketing)
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- Aurora García-Gallego & Nikolaos Georgantzis & Ainhoa Jaramillo-Gutiérrez & Pedro Pereira & J. Carlos Pernías-Cerrillo, 2013. "On the evolution of monopoly pricing in Internet-assisted search markets," Working Papers 2013/05, Economics Department, Universitat Jaume I, Castellón (Spain).
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