Do low-price Guarantees facilitate Collusion?
AbstractWe examine the role low-price guarantees allegedly play in supporting supracompetitive prices. We find that when firms can commit to matching or beating any lower price announced by a competitor, all Nash equilibria yield Bertrand selling prices. This result casts doubt on the robustness of the conclusions of models which restrict attention to meet-the-competition clauses only.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by University of Warwick, Department of Economics in its series The Warwick Economics Research Paper Series (TWERPS) with number 422.
Date of creation: 1994
Date of revision:
Other versions of this item:
- Hviid, M. & Shaffer, G., 1994. "Do Low-Price Guarantees Facilitate Collusion?," Papers, Michigan - Center for Research on Economic & Social Theory 94-01, Michigan - Center for Research on Economic & Social Theory.
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Enrique Fatás & Juan A. Mañez, 2004. "Are Low-Price Compromises Collusion Guarantees? An Experimental Test of Price Matching Policies," Economic Working Papers at Centro de Estudios Andaluces E2004/33, Centro de Estudios Andaluces.
- Enrique Fatas & Juan Mañez, 2007. "Are low-price promises collusion guarantees? An experimental test of price matching policies," Spanish Economic Review, Springer, Springer, vol. 9(1), pages 59-77, March.
- Arbatskaya, Maria & Hviid, Morten & Shaffer, Greg, 2006. "On the use of low-price guarantees to discourage price cutting," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 24(6), pages 1139-1156, November.
- Corts, Kenneth S., 1997. "On the competitive effects of price-matching policies," International Journal of Industrial Organization, Elsevier, Elsevier, vol. 15(3), pages 283-299, May.
- Morten Hviid & Greg Shaffer, 2012. "Optimal low-price guarantees with anchoring," Quantitative Marketing and Economics, Springer, Springer, vol. 10(4), pages 393-417, December.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Helen Neal).
If references are entirely missing, you can add them using this form.