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Pricing with Monitoring Costs

Author

Listed:
  • Steven Coissard
  • Carlos Seiglie

Abstract

This paper presents empirical evidence which at first glance appears to show that firms are not pricing to maximize profits. We then present a model to explain how this behavior is in fact optimal when we account for additional constraints faced by firms in certain product markets.

Suggested Citation

  • Steven Coissard & Carlos Seiglie, 2011. "Pricing with Monitoring Costs," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 54(4), pages 421-433.
    • Handle: RePEc:bxr:bxrceb:2013/122849
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    File URL: https://dipot.ulb.ac.be/dspace/bitstream/2013/122849/1/ARTICLECOISSARD-SEIGLIE.pdf
    File Function: ARTICLE COISSARD-SEIGLIE
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    More about this item

    Keywords

    Price Discrimination; Monitoring Costs; Pricing Anomaly;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm

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