Pricing and Trust

Publikation: Working paper › Forskning

Standard

Pricing and Trust. / Huck, Steffen; Ruchala, Gabriele K.; Tyran, Jean-Robert.

Cph. : Department of Economics, University of Copenhagen, 2007.

Publikation: Working paper › Forskning

Harvard

Huck, S, Ruchala, GK & Tyran, J-R 2007 'Pricing and Trust' Department of Economics, University of Copenhagen, Cph. <https://www.econ.ku.dk/Research/Publications/pink/2007/0704.pdf>

APA

Huck, S., Ruchala, G. K., & Tyran, J-R. (2007). Pricing and Trust. Department of Economics, University of Copenhagen. https://www.econ.ku.dk/Research/Publications/pink/2007/0704.pdf

Vancouver

Huck S, Ruchala GK, Tyran J-R. Pricing and Trust. Cph.: Department of Economics, University of Copenhagen. 2007.

Author

Huck, Steffen ; Ruchala, Gabriele K. ; Tyran, Jean-Robert. / Pricing and Trust. Cph. : Department of Economics, University of Copenhagen, 2007.

Bibtex

@techreport{e5ca6680b20111dbbee902004c4f4f50,
title = "Pricing and Trust",
abstract = "We experimentally examine the effects of flexible and fixed prices in markets for experience goods in which demand is driven by trust. With flexible prices, we observe low prices and high quality in competitive (oligopolistic) markets, and high prices coupled with low quality in non-competitive (monopolistic) markets. We then introduce a regulated intermediate price above the oligopoly price and below the monopoly price. The effect in monopolies is more or less in line with standard intuition. As price falls volume increases and so does quality, such that overall efficiency is raised by 50%. However, quite in contrast to standard intuition, we also observe an efficiency rise in response to regulation in oligopolies. Both, transaction volume and traded quality are, in fact, maximal in regulated oligopolies",
keywords = "Faculty of Social Sciences, markets, price competition, price regulation, reputation, trust, moral hazard",
author = "Steffen Huck and Ruchala, {Gabriele K.} and Jean-Robert Tyran",
note = "JEL Classification: C72, C90, D40",
year = "2007",
language = "English",
publisher = "Department of Economics, University of Copenhagen",
address = "Denmark",
type = "WorkingPaper",
institution = "Department of Economics, University of Copenhagen",

}

RIS

TY - UNPB

T1 - Pricing and Trust

AU - Huck, Steffen

AU - Ruchala, Gabriele K.

AU - Tyran, Jean-Robert

N1 - JEL Classification: C72, C90, D40

PY - 2007

Y1 - 2007

N2 - We experimentally examine the effects of flexible and fixed prices in markets for experience goods in which demand is driven by trust. With flexible prices, we observe low prices and high quality in competitive (oligopolistic) markets, and high prices coupled with low quality in non-competitive (monopolistic) markets. We then introduce a regulated intermediate price above the oligopoly price and below the monopoly price. The effect in monopolies is more or less in line with standard intuition. As price falls volume increases and so does quality, such that overall efficiency is raised by 50%. However, quite in contrast to standard intuition, we also observe an efficiency rise in response to regulation in oligopolies. Both, transaction volume and traded quality are, in fact, maximal in regulated oligopolies

AB - We experimentally examine the effects of flexible and fixed prices in markets for experience goods in which demand is driven by trust. With flexible prices, we observe low prices and high quality in competitive (oligopolistic) markets, and high prices coupled with low quality in non-competitive (monopolistic) markets. We then introduce a regulated intermediate price above the oligopoly price and below the monopoly price. The effect in monopolies is more or less in line with standard intuition. As price falls volume increases and so does quality, such that overall efficiency is raised by 50%. However, quite in contrast to standard intuition, we also observe an efficiency rise in response to regulation in oligopolies. Both, transaction volume and traded quality are, in fact, maximal in regulated oligopolies

KW - Faculty of Social Sciences

KW - markets

KW - price competition

KW - price regulation

KW - reputation

KW - trust

KW - moral hazard

M3 - Working paper

BT - Pricing and Trust

PB - Department of Economics, University of Copenhagen

CY - Cph.

ER -

ID: 384908