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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 article, the authors provide a theoretical and empirical examination of how the thousands digit in a home's asking price is related to the final transaction price relative to its true underlying value.
Abstract: While true underlying home values are expected to be randomly distributed, actual residential listing prices tend to be highly clustered. Particularly, more than 75 % of the homes in our sample are associated with a round or “just below” round asking price. This study provides a theoretical and empirical examination of how the thousands digit in a home’s asking price is related to the final transaction price relative to its true underlying value. Our findings suggest that, on average, homes listed using a “just below” pricing strategy are associated with the greatest discount negotiated relative to the asking price. However, the higher initial degree of list overpricing reflected in “just below” pricing compared with other strategies more than offsets the greater discount. Therefore, “just below” is the most effective pricing strategy for the seller in terms of a greater dollar yield relative to value. These empirical findings have economic significance and are robust across both “buyer” and “seller” housing markets, new versus existing homes, and across multiple home price ranges.
38 citations
Posted Content•
TL;DR: In this paper, the authors model journal pricing behavior in a portfolio demand environment and consider how the ongoing transition from print to digital distribution has lead to endogenous changes in pricing behavior, when choosing whether or not to price discriminate, publishers compare the benefits of selling more content to each set of buyers against the associated additional costs.
Abstract: I model journal pricing behavior in a portfolio demand environment and consider how the ongoing transition from print to digital distribution has lead to endogenous changes in pricing behavior. Specifically, when choosing whether or not to price discriminate, publishers compare the benefits of selling more content to each set of buyers against the associated additional costs. As the distribution costs decline, price discrimination becomes more attractive. However, since this cost decline also creates new entry opportunities, incumbent firms may also need to bundle their journals to avoid displacement of individual titles.
38 citations
TL;DR: In this article, three Georgia feeder cattle teleauction markets were analyzed from 1977 to 1988 to estimate the impacts of cattle characteristics and market conditions on prices, and the results showed that cattle characteristic price impacts were similar to those in previous studies.
Abstract: Three Georgia feeder cattle teleauction markets were analyzed from 1977 to 1988 to estimate the impacts of cattle characteristics and market conditions on prices. Cattle characteristic price impacts were similar to those in previous studies. The impact of feeder cattle futures price on teleauction price was positive but varied across markets. Optimal lot size ranged from 143 to 276 head. In one market, 14 lots were necessary to generate positive price impacts. Additional buyers were estimated to have a $.30/cwt per buyer impact on price.
38 citations
Posted Content•
TL;DR: In this article, the authors argue that price discrimination is more likely to lead to greater welfare than is the uniform pricing alternative, sometimes for every party in the transaction, and that in many such situations, the seller does not obtain an above-average rate of return.
Abstract: Price discrimination is the practice of charging different customers different prices for the same product. Many people consider price discrimination unfair, but economists argue that in many cases price discrimination is more likely to lead to greater welfare than is the uniform pricing alternative — sometimes for every party in the transaction. This article shows i) that there are many situations in which it is necessary to engage in differential pricing in order to make the provision of a product possible; and ii) that in many such situations, the seller does not obtain an above-average rate of return. It concludes that price discrimination is not inherently unfair. The article also contends that even when conditions i) and/or ii) do not occur, price discrimination is not necessarily unethical. In itself, the fact that some people get an even better deal than do others does not entail that the latter are wronged.
38 citations
TL;DR: It is shown that the availability of a flexible resource helps maintain stable price differences across products over time even though the price of each product may fluctuate over time.
Abstract: Firms that offer multiple products are often susceptible to periods of inventory mismatches where one product may face shortages while the other has excess inventories. In this paper, we study a joint implementation of price- and capacity-based substitution mechanisms to alleviate the level of such inventory disparities. We consider a firm producing substitutable products via a capacity portfolio consisting of both product-dedicated and flexible resources and characterize the structure of the optimal production and pricing decisions. We then explore how changes in various problem parameters affect the optimal policy structure. We show that the availability of a flexible resource helps maintain stable price differences across products over time even though the price of each product may fluctuate over time. This result has favorable ramifications from a marketing standpoint because it suggests that even when a firm applies a dynamic pricing strategy, it may still establish consistent price positioning among...
38 citations