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Are all online hotel prices created dynamic? An empirical assessment

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  • Melis, Giuseppe
  • Piga, Claudio A

Abstract

Understanding how tourist firms set their online prices is important due to their growing reliance on Online Travel Agencies (OTA). Little is known, however, about whether differences exist in the online pricing approaches adopted by hotels using an OTA. The article tests, using a big data approach, whether the diffuse narrative of a pervasive presence of dynamic pricing provides a realistic description of hotels’ pricing behavior and thus challenges the view that dynamic pricing should be considered the prevailing norm for the industry. The evidence suggests a heterogenous attitude across hotels, with uniform pricing being more widespread in most hotels of our sample, namely, the 3-star or less, while dynamic pricing is more likely applied in higher quality hotels.

Suggested Citation

  • Melis, Giuseppe & Piga, Claudio A, 2016. "Are all online hotel prices created dynamic? An empirical assessment," MPRA Paper 75896, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:75896
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    Cited by:

    1. P. Figini & S. Cicognani & L. Zirulia, 2019. "Booking in the Rain: Testing the impact of public information on prices," Working Papers wp1137, Dipartimento Scienze Economiche, Universita' di Bologna.
    2. Pulina, Manuela & Santoni , Valentina, 2018. "Hotel online pricing policy: A review and a regional case study," INVESTIGACIONES REGIONALES - Journal of REGIONAL RESEARCH, Asociación Española de Ciencia Regional, issue 42, pages 93-111.
    3. Andrea Mantovani & Claudio Piga & Carlo Reggiani, 2019. "Much ado about nothing? Online platform price parity clauses and the EU Booking.com case," Economics Discussion Paper Series 1909, Economics, The University of Manchester.

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    More about this item

    Keywords

    Revenue Management; Online travel agents; Heterogeneous strategic management behaviour; dynamic pricing;
    All these keywords.

    JEL classification:

    • L81 - Industrial Organization - - Industry Studies: Services - - - Retail and Wholesale Trade; e-Commerce
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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