Automated Pricing Rules in Electronic Posted Offer Markets.

Internet markets are heralded as enhancing efficiency by providing buyers and sellers with an abundance of information. In these electronic markets, firms have the opportunity to employ “pricebots,” computerized algorithms that automatically adjust prices to prevailing market conditions. This articl...

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Publicado en:Economic Inquiry Vol. 41; no. 2; pp. 208 - 224
Autores principales: Deck, Cary A., Wilson, Bart J.
Formato: Artículo
Publicado: Wiley-Blackwell April 2003
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        atl: Automated Pricing Rules in Electronic Posted Offer Markets.
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          Deck, Cary A.
          Wilson, Bart J.
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        Algorithms
        Electronic commerce
        Internet auctions
        Pricing
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          Algorithms
          Electronic commerce
          Internet auctions
          Pricing
      ab: Internet markets are heralded as enhancing efficiency by providing buyers and sellers with an abundance of information. In these electronic markets, firms have the opportunity to employ “pricebots,” computerized algorithms that automatically adjust prices to prevailing market conditions. This article uses laboratory methods to examine the potential market impact of the endogenous selection of three automated pricing algorithms: undercutting, low-price matching, and trigger pricing. We find that the undercutting algorithm leads to prices similar to the game-theoretic prediction. Low-price matching generates significantly higher prices, and trigger pricing results in market prices below the game-theoretic prediction. Reprinted by permission of the publisher.
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