A New Model of Persistent Retail Price Dispersion

10 Pages Posted: 18 Jul 2005

Date Written: July 6, 2005

Abstract

Price dispersion persists, even on the Internet where search costs are small. One reason may be that consumers prefer randomized prices to fixed prices, implying that retail price data will always show some degree of price dispersion.

Keywords: Price dispersion, uncertainty, risk, indirect utility, von Neumann, Morgenstern, price theory, one price, law of one price

JEL Classification: D11, D40, L11

Suggested Citation

Thiel, Stuart E., A New Model of Persistent Retail Price Dispersion (July 6, 2005). Available at SSRN: https://ssrn.com/abstract=757357 or http://dx.doi.org/10.2139/ssrn.757357

Stuart E. Thiel (Contact Author)

DePaul University ( email )

1 E. Jackson Blvd.
Chicago, IL 60604
United States
312-362-8011 (Phone)