search query: @author Coles, M. G. / total: 5
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| Author: | Burdett, K. Coles, M. G. |
| Title: | Steady state price distributions in a noisy search equilibrium |
| Journal: | Journal of Economic Theory
1997 : JAN, VOL. 72:1, p. 1-32 |
| Index terms: | PRICING CUSTOMERS RETAILING |
| Language: | eng |
| Abstract: | This study characterizes an equilibrium where each store changes it's price as it's stock of regular customers changes, in a model of noisy search where customers repeat purchase.There are stores of different size and age in the market, price dispersion is an equilibrium outcome. Smaller and younger stores announce lower prices and grow faster than larger, established stores. To build business up, the younger stores set prices below marginal costs. To attract customers, they are willing to take an early operating loss. |
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