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Limit price
About: Limit price is a research topic. Over the lifetime, 4865 publications have been published within this topic receiving 148546 citations.
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TL;DR: In this paper, the authors estimate the pass-through of wholesale electricity price to the end consumer price with variable price contracts in the Norwegian electricity market using weekly data and find substantial asymmetry when retailers pass on the impact of price changes in the wholesale market to the retail prices.
45 citations
TL;DR: This article proposed a model that relates transaction cost to characteristics of order flow and found that an unusual excess of buyers relative to sellers (buyers) tends to increase the ask (bid) price and that the ask and bid components of spread change asymmetrically about the efficient price.
45 citations
TL;DR: In this article, the authors consider variants of a dynamic duopoly model where one firm has a stronger market position than its competitor, and consumers' past purchases may reveal their different valuations for the two firms' products.
Abstract: This paper considers variants of a dynamic duopoly model where one firm has a stronger market position than its competitor. Consumers' past purchases may reveal their different valuations for the two firms' products. Price discrimination based on purchase histories tends to benefit consumers if it does not cause the weaker firm to exit; otherwise it can harm consumers. The effect of price discrimination also depends on firms' cost differences, market competitiveness, and consumers' time horizon. The stronger firm may price below cost in the presence of consumer switching costs, with the purpose and effect of eliminating competition.
45 citations
TL;DR: In this paper, the authors investigated price-setting behavior of firms based on the individual price quotes underlying the Swiss consumer price index and found that prices are sticky; the median duration amounts to 4.6 quarters.
Abstract: This paper investigates price-setting behaviour of firms based on the individual price quotes underlying the Swiss consumer price index. The data set covers the years from 1993 to 2005. Six main findings emerge from the analysis. (i) Prices are sticky; the median duration amounts to 4.6 quarters. (ii) Price-setting behaviour is heterogeneous across sectors and outlet characteristics. (iii) Price changes are sizeable; the median absolute size amounts to 9.4%. (iv) There is little evidence of downward price stickiness; almost half of all price changes are decreases. An exception is the service sector, however, where there is evidence of asymmetries in price-setting due to downward rigid wages. (v) Firms respond to expected cost shocks at the date of their occurrence; VAT rate changes do not lead to more price adjustments before they take effect. (vi) There is some evidence that firms adjust their behaviour according to the state of the economy; in particular, firms facing higher rates of inflation adjust prices more frequently.
45 citations
TL;DR: In this paper, the authors empirically examined whether houses using range pricing, often referred to as value range marketing, sell in the same amount of time and sell for similar prices as those marketed in the traditional manner.
Abstract: In various markets around the country, some real estate professionals are employing a new pricing strategy that involves marketing homes for sale with a price range rather than a single asking price. This strategy is often touted as a mechanism that will attract more potential buyers to look at a house and thus result in reduced marketing times for existing homes, with prices determined by competitive forces. The purpose of this study is to empirically examine whether houses using range pricing, often referred to as value range marketing, sell in the same amount of time and sell for similar prices as those marketed in the traditional manner. Two staged least squares with a correction for sample selection and Weibull duration models are used to test the hypotheses, employing a sample of 5,852 residential houses that were sold during the period January 1999 to December 2000. In contrast to claims of the strategy’s proponents, the results indicate that houses take longer to sell when using the range pricing strategy after controlling for physical characteristics and market conditions. Furthermore, there is no evidence that this strategy has any significant impact on transaction prices.
45 citations