The Effects of Search Costs on Prices and Price Dispersion: A Web-Based Classroom Game

8 Pages Posted: 20 Jul 2005 Last revised: 3 Jun 2009

Date Written: June 2, 2009

Abstract

Business and information systems students often have difficulty understanding the market forces behind Internet prices. This paper describes a web-based classroom game used to demonstrate the effects of reduced search costs on price levels and price disper-sion as well as the possible benefits to both buyers and sellers. The game is available for free and does not require any specialized hardware or software; the only equipment needed is a computer connected to the internet running a standard browser. The game takes less than 20 minutes and students may participate simultaneously or separately.

Keywords: Classroom Games, Search Costs and Information Systems Economics

JEL Classification: A20

Suggested Citation

Wolf, James R., The Effects of Search Costs on Prices and Price Dispersion: A Web-Based Classroom Game (June 2, 2009). Available at SSRN: https://ssrn.com/abstract=756964 or http://dx.doi.org/10.2139/ssrn.756964

James R. Wolf (Contact Author)

Illinois State University ( email )

Campus Box 5150
Normal, IL 61761
United States

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