Prices and Price Dispersion on the Web: Evidence from the Online Book Industry

Clay, Karen; Krishnan, Ramayya; Wolff, Eric W.

doi:10.3386/w8271

Cited by 106 publications

(157 citation statements)

References 16 publications

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“…As a result, many internet studies were conducted using data from books. For example, Clay, Krishnan, and Wolff (2001) find that competition leads to lower prices and lower price dispersion, and that widely advertised items have lower prices. Clay, Krishnan, Wolff, and Fernandes (2002) find that even though the average prices are similar between online and physical stores, price dispersion is greater for the former, indicating that online firms do not charge the same prices.…”

Section: General and Academic Publishingmentioning

confidence: 99%

A textbook example of international price discrimination

et al. 2007

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We investigate differences in book prices between the United States and other countries. We find that general audience books are similarly priced internationally, but textbooks are substantially more expensive in the United States (often more than double the price). This disparity is much more pronounced for commercial publishers than for university presses. We argue that supply-side factors like cost and market structure can not explain this phenomenon. We discuss several demand-side explanations; our preferred theory is that higher US textbook prices reflect the unique status of the textbook as a centerpiece of US college instruction.

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Section: General and Academic Publishingmentioning

confidence: 99%

A textbook example of international price discrimination

et al. 2007

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“…However, recent years have seen a greater number of studies using Internet-sourced data-obtained either directly from retailer websites or indirectly from price comparison websites. See, for example, Clay et al (2001), Brown and Goolsbee (2002), Baye et al (2004a, b), Ellison and Ellison (2009), and Cavallo (2017.…”

Section: Empirical Literature On Price Dispersion and Search Costmentioning

confidence: 99%

Price dispersion, chain heterogeneity, and search in online grocery markets

González

Miles-Touya

2018

SERIEs

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This paper identifies patterns of cross-sectional and temporal price dispersion-in the Spanish online grocery retail market-and evaluates the extent to which search costs and chain heterogeneity explain such dispersion. We build a data set comprising 836,074 prices for the most popular grocery products sold online by Spanish national chains at different locations. Our results show that price dispersion is still present (albeit to a lesser extent) even after controlling for chain heterogeneity and that it persists over time. We structurally estimate search costs distributions for two different baskets of goods using price data while accounting for vertical product differentiation. The analysis suggests that the extent of search is low. According to our estimates more than two thirds of consumers do not compare prices among supermarkets. We also find that more frequently purchased products have lower search cost and also lower price-cost margins.

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“…Our agent collected information about unit price, shipping cost, shipping time, and delivery time. For a further discussion of the dataset we refer the reader to Clay et al (2001). We begin by formulating a predictive model of price in §5.1 using this data, present an analysis of store response times in §5.2, discuss the part-worths of the utility function, the disutility of waiting, and cognitive costs in §5.3.…”

Section: An Empirical Study Of Online Book Prices Store Response Timmentioning

confidence: 99%

“…These shopbots automatically search a large number of vendors for price and availability. Given the wide degree of price variation for consumer products on the Internet, comparison shopping can provide real benefits (Hann, Hitt, and Clemens 2000;Brynjolfsson and Smith 2000;Clay, Krishnan, and Wolff 2001). For example, suppose a consumer wishes to purchase the novel Bear and the Dragon by Tom Clancy.…”

Section: Introductionmentioning

confidence: 99%

Designing a Better Shopbot

et al. 2004

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Abstract:A primary tool that consumers have for comparative shopping are shopbots, which is short for shopping robots. These shopbots automatically search a large number of vendors for price and availability. Typically a shopbot searches a predefined set of vendors and reports all results. This can result in time consuming searches that provide redundant or dominated alternatives. Our research demonstrates analytically how shopbot designs can be improved by developing a utility model of consumer purchasing behavior. This utility model considers the intrinsic value of the product and its attributes, the disutility from waiting, and the cognitive costs associated with evaluating the offers retrieved. We focus on the operational decisions made by the shopbot: which stores to search, how long to wait, and which offers to present to the user. To illustrate our model we calibrate the model to price and response time data collected at online bookstores over a six-month period. Using prior expectations about price and response time we show how shopbots can substantially increase consumer utility by searching more intelligently and selectively presenting offers.

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Prices and Price Dispersion on the Web: Evidence from the Online Book Industry

Cited by 106 publications

References 16 publications

A textbook example of international price discrimination

A textbook example of international price discrimination

Price dispersion, chain heterogeneity, and search in online grocery markets

Designing a Better Shopbot

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