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Pricing on the Internet

Author

Listed:
  • Arup Daripa
  • Sandeep Kapur

Abstract

It is often claimed that e-commerce has created a more competitive environment by encouraging the entry of new online firms and by enabling buyers to search easily for the lowest prices. The limited evidence that exists paints a mixed picture. Many online markets are advertising- and technology-intensive, creating a tendency towards growing concentration. Price search is imperfect and firms can dampen price competition by increasing product heterogeneity and switching costs. In many sectors, online firms may come to acquire some market power. We look at the forms of pricing that are likely to emerge in such markets, including the greater use of price discrimination and auction-like trading arrangements. Copyright 2001, Oxford University Press.

Suggested Citation

  • Arup Daripa & Sandeep Kapur, 2001. "Pricing on the Internet," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 17(2), pages 202-216, Summer.
  • Handle: RePEc:oup:oxford:v:17:y:2001:i:2:p:202-216
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    Cited by:

    1. Marco Bertini & Luc Wathieu, 2008. "Research Note—Attention Arousal Through Price Partitioning," Marketing Science, INFORMS, vol. 27(2), pages 236-246, 03-04.
    2. Just, David R. & Just, Richard E., 2005. "Distributional Implications of the Internet: Can Price Discrimination Improve Farmers’ Welfare?," Working Papers 127074, Cornell University, Department of Applied Economics and Management.
    3. Gatti, J.R.J. & Kattuman, P., 2003. "Online Price Dispersion Within and Between Seven European Countries," Cambridge Working Papers in Economics 0343, Faculty of Economics, University of Cambridge.

    More about this item

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D2 - Microeconomics - - Production and Organizations
    • D3 - Microeconomics - - Distribution
    • D4 - Microeconomics - - Market Structure, Pricing, and Design

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