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The Price Effects of Prohibiting Price Parity Clauses: Evidence from International Hotel Groups

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  • Jack (Peiyao) Ma
  • Andrea Mantovani
  • Carlo Reggiani
  • Annette Broocks
  • Néstor Duch-Brown

Abstract

Dominant platforms such as Booking.com and Amazon often impose Price Parity Clauses to prevent sellers from charging lower prices on alternative sales channels. We provide quasi experimental evidence on the removal of these price restrictions in France in 2015 for three major international hotel groups. First, our analysis reveals limited and non-significant effects on room prices sold through channels visible to consumers, such as the hotels’ websites or Online Travel Agencies. Second, we document a significant price reduction on sales channels not visible to consumers, such as the hotels’ direct offline channel. Third, we identify a significant shift in sales share from online travel agencies to the hotels’ direct offline channel.

Suggested Citation

  • Jack (Peiyao) Ma & Andrea Mantovani & Carlo Reggiani & Annette Broocks & Néstor Duch-Brown, 2024. "The Price Effects of Prohibiting Price Parity Clauses: Evidence from International Hotel Groups," Economics Series Working Papers 1043, University of Oxford, Department of Economics.
    • Handle: RePEc:oxf:wpaper:1043
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