Price matching and platform pricing

Bottasso, Anna and Marocco, Paolo and Robbiano, Simone (2021): Price matching and platform pricing.

Abstract

We investigate the effects of Price Matching Guarantees policies adopted by the US NewEgg online platform on prices of a representative sample of consumer electronics products. By applying a Difference-in-Differences identification strategy, we find price reductions of about 4% occurring after the policy implementation. We control for products characteristics recovered from User Generated Contents (products popularity and quality) and perform heterogeneity analysis based on products visibility (Google Search Rank). Estimates suggest that for high (low) visible products prices are higher (lower) during the policy validity period. Results are consistent with the hypothesis that such policies can act as tools for price discrimination.

• Item Type: MPRA Paper
• Language: English
• Keywords: Price Matching Guarantees; Online Sales Platforms; User Generated Contents; Difference-in-Differences
• Subjects: L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L11 - Production, Pricing, and Market Structure ; Size Distribution of Firms; L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L15 - Information and Product Quality ; Standardization and Compatibility; L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L20 - General; L - Industrial Organization > L8 - Industry Studies: Services > L81 - Retail and Wholesale Trade ; e-Commerce

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