A Theory of Stable Price Dispersion (joint with David Myatt)
We propose a two-stage replacement for established “clearinghouse” or “captive and shopper” pricing models: second-stage retail prices are constrained by first-stage list prices. In contrast to the mixed-strategy equilibria of single-stage games, a unique profile of distinct prices is supported by the play of pure strategies along the equilibrium path, and so we predict stable price dispersion. We find novel results in applications to models of sales, product prominence, advertising, and consumer search.
Date:
5 November 2019, 12:45 (Tuesday, 4th week, Michaelmas 2019)
Venue:
Nuffield College, New Road OX1 1NF
Venue Details:
Butler Room
Speaker:
David Ronayne (University of Oxford)
Organising department:
Department of Economics
Part of:
Economic Theory Workshop
Booking required?:
Not required
Audience:
Members of the University only
Editor:
Melis Clark
