Table of Contents

Handbook on the Economics of Retailing and Distribution

Handbook on the Economics of Retailing and Distribution

Edited by Emek Basker

This Handbook explores and critically examines current research in economics and marketing science on key economic issues in retailing and distribution. Providing a rich perspective for the discussion of public policy, contributions from several disciplines and continents range from the history of chains and the impact of multinational retailers on international trade patterns; to the US merger policy in the retail context, the rise of the Internet and consumer-to-consumer sales. This state-of-the-art Handbook is an essential reference for students and academics of economics and marketing science and offers outsiders valuable perspectives on operations research, data analytics, geography, and sociology.

Chapter 12: Price search and obfuscation: an overview of the theory and empirics

Sara Fisher Ellison

Subjects: business and management, marketing, economics and finance, industrial economics


This chapter focuses on the topic of price search, both the theory and empirics of the broad notion first motivated by Stigler in 1961. I present results from some of the standard models of price search and discuss empirical analyses that either test those models in retail markets or exploit structure in those models to derive estimates of quantities of interest, such as search costs. I also discuss a more recent and growing literature on price obfuscation, or the actions that firms take to make price search more costly. Finally, I touch on how retail price search has changed with advances in technology. One broad goal is to lay out a useful theoretical framework for assessing markets where search costs are an important feature. A second is to discuss the empirical evidence from retail markets on price search costs. Along the way, I also indicate the different styles of empirical work and discuss their roles in improved understanding of these phenomena.

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