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Price Discrimination and Customer Behaviour: Empirical Evidence from Marseille

Author

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  • Alan Kirman

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • Sonia Moulet

    (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique)

  • Rainer Schulz

    (Business School Aberdeen - Aberdeen University)

Abstract

We analyse the interaction between a seller and customers in a shop on the fruits and vegetables wholesale market in Marseille using an unique data set. We find that customers' bargaining activity is correlated with the kind and location of the business. To determine how the interactions between the seller and the customers influence prices, we compare the price each customer pays for a given good with the daily average price. We find that a customer of the shop is more likely to pay a price higher than other customers for the same good if---ceteris paribus---the customer is unknown to the shop assistants, buys only a small quantity, or buys goods sold on commission. If the customer is known to the shop assistants, then loyalty and bargaining make it more likely that the customer gets better than average price.

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  • Alan Kirman & Sonia Moulet & Rainer Schulz, 2008. "Price Discrimination and Customer Behaviour: Empirical Evidence from Marseille," Working Papers halshs-00349036, HAL.
    • Handle: RePEc:hal:wpaper:halshs-00349036
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00349036
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    Cited by:

    1. Beckert, Jens, 2011. "Where do prices come from? Sociological approaches to price formation," MPIfG Discussion Paper 11/3, Max Planck Institute for the Study of Societies.
    2. Sylvain Mignot & Gabriele Tedeschi & Annick Vignes, 2012. "An Agent Based Model of Switching: The Case of Boulogne S/mer Fish Market," Journal of Artificial Societies and Social Simulation, Journal of Artificial Societies and Social Simulation, vol. 15(2), pages 1-3.
    3. Joshua Sherman & Avi Weiss, 2015. "Price Response, Asymmetric Information and Competition," Economic Journal, Royal Economic Society, vol. 125(589), pages 2077-2115, December.

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    Keywords

    Face-to-face bargaining; customer loyalty;

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