Abstract

http://ssrn.com/abstract=450220
 
 

References (50)



 
 

Citations (10)



 


 



A Nearly Perfect Market?


Erik Brynjolfsson


Massachusetts Institute of Technology (MIT) - Sloan School of Management; National Bureau of Economic Research (NBER)

Astrid Andrea Dick


INSEAD; Federal Reserve Bank of New York

Michael D. Smith


Carnegie Mellon University - H. John Heinz III School of Public Policy and Management

February 2009


Abstract:     
We estimate the magnitude of consumer search benefits and costs using data obtained from a major Internet shopbot. For the median consumer, the benefits to searching lower screens are $6.55 while the cost of an exhaustive search of the offers is a maximum of $6.45. We are also able to estimate price elasticities and find that they are relatively high compared to offline markets (-7 to -10 in our base model). Our results suggest that consumers face fairly high costs to search for information online, even in the "nearly perfect" market of the shopbot.

Number of Pages in PDF File: 41

Keywords: Search costs, shopbot, product differentiation, random coefficients choice model

working papers series


Download This Paper

Date posted: October 20, 2003 ; Last revised: June 9, 2014

Suggested Citation

Brynjolfsson, Erik and Dick, Astrid Andrea and Smith, Michael D., A Nearly Perfect Market? (February 2009). Available at SSRN: http://ssrn.com/abstract=450220 or http://dx.doi.org/10.2139/ssrn.450220

Contact Information

Erik Brynjolfsson
Massachusetts Institute of Technology (MIT) - Sloan School of Management ( email )
E53-313
Cambridge, MA 02142
United States
617-253-4319 (Phone)
HOME PAGE: http://digital.mit.edu/erik
National Bureau of Economic Research (NBER) ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Astrid Andrea Dick
INSEAD ( email )
Boulevard de Constance
77305 Fontainebleau Cedex
France
Federal Reserve Bank of New York ( email )
33 Liberty Street
New York, NY 10045
United States
Michael D. Smith (Contact Author)
Carnegie Mellon University - H. John Heinz III School of Public Policy and Management ( email )
Pittsburgh, PA 15213-3890
United States
HOME PAGE: http://www.heinz.cmu.edu/~mds
Feedback to SSRN


Paper statistics
Abstract Views: 13,386
Downloads: 1,792
Download Rank: 4,166
References:  50
Citations:  10

© 2014 Social Science Electronic Publishing, Inc. All Rights Reserved.  FAQ   Terms of Use   Privacy Policy   Copyright   Contact Us
This page was processed by apollo6 in 0.343 seconds