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Price negotiation in differentiated product markets: An analysis of the market for insured mortgages in Canada


  • Robert Clark


  • Jason Allen

    (Bank of Canada)

  • Jean-Francois Houde

    (University of Wisconsin)


We propose a model of bank choice and price negotiation that incorporates three key features of the market: differentiated services, heterogeneous bank valuations of consumers, and search costs. More generally, our goal is to build and estimate a tractable empirical model to analyze differentiated markets in which prices are negotiated rather than posted.

Suggested Citation

  • Robert Clark & Jason Allen & Jean-Francois Houde, 2010. "Price negotiation in differentiated product markets: An analysis of the market for insured mortgages in Canada," 2010 Meeting Papers 1072, Society for Economic Dynamics.
  • Handle: RePEc:red:sed010:1072

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    Cited by:

    1. Gautam Gowrisankaran & Aviv Nevo & Robert Town, 2015. "Mergers When Prices Are Negotiated: Evidence from the Hospital Industry," American Economic Review, American Economic Association, vol. 105(1), pages 172-203, January.
    2. Jason Allen & Robert Clark & Jean-Fran?ois Houde, 2014. "The Effect of Mergers in Search Markets: Evidence from the Canadian Mortgage Industry," American Economic Review, American Economic Association, vol. 104(10), pages 3365-3396, October.

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