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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 study empirical regularities of price change timing for music CD vendors and booksellers to assess several theoretical explanations and find evidence of business rules for strategic pricing associated with tacitly collusive pricing and Edgeworth competition.
Abstract: Internet technologies should lessen information asymmetry, prompting competitive price reactions, but this does not seem to be happening in Internet-based selling. We study empirical regularities of price change timing for music CD vendors and booksellers to assess several theoretical explanations. Our sample includes 123, 680 daily prices for 169 products and 53 firms. Bertrand competition is insufficient to explain our observation that sellers do not shift prices this way. Tacitly collusive responses to competitors' price changes are observed rather than price changes solely in response to demand or cost shifts as would be expected with Bertrand competition. We find evidence of business rules for strategic pricing associated with tacitly collusive pricing and Edgeworth competition. Copyright © 2007 John Wiley & Sons, Ltd.
34 citations
TL;DR: The findings altogether demonstrate that electricity price marketization may result in multiple economic benefits; the results presented here also may provide a useful reference for Chinese market reform policies in future.
34 citations
TL;DR: In this article, a new dynamic approach for forecasting the market price of electricity in the short term is proposed, where price dates are first clustered according to different types of daily profiles and then, given a proper function representing the trend in price, the unknown parameters are identified based on the zeroing of a Lyapunov function.
Abstract: Price forecast is a key issue in competitive electricity markets. It provides useful information for the market players and the regulators, in both short and long run. Different approaches have been proposed and implemented. A new dynamic approach for forecasting the market price of electricity in the short term is proposed. The price dates are first clustered according to different types of daily profiles and then, given a proper function representing the trend in price, the set of unknown parameters are identified based on the zeroing of a Lyapunov function. The forecast can be dynamically updated with the latest data available. Higher weight can be attributed to this data in determining the future prices. The proposed approach is validated with reference to real systems in the form of the Italian, New England and New York electricity markets. In addition, an extensive price forecast is provided for the Italian market, an example of a young market that is rather difficult to predict patterns for.
34 citations
TL;DR: Pass-through is strongly asymmetric with respect to wholesale price increases versus decreases and covariates such as private label versus national brand, 99-cent price endings, and the time since the last wholesale price change have a much stronger impact on the first stage of the decision process than on the second stage.
Abstract: We study the pass-through of wholesale price changes onto regular retail prices using an unusually detailed data set obtained from a major retailer. We model pass-through as a two-stage decision process that reflects both whether as well as how much to change the regular retail price. We show that pass-through is strongly asymmetric with respect to wholesale price increases versus decreases. Wholesale price increases are passed through to regular retail prices 70% of the time while wholesale price decreases are passed through only 9% of the time. Pass-through is also asymmetric with respect to the magnitude of the wholesale price change, with the magnitude affecting the response to wholesale price increases but not decreases. Finally, we show that covariates such as private label versus national brand, 99-cent price endings, and the time since the last wholesale price change have a much stronger impact on the first stage of the decision process (i.e., whether to change the regular retail price) than on th...
34 citations
TL;DR: In this paper, the authors apply a multiple-discrete/continuous model of fresh produce demand to study the impact of price promotion on retail apple sales, and find that the brand switching/category incidence effect of promotion is closer to 65/35 than the more usual 80/20 rule, when the nature of the decision is appropriately taken into consideration.
34 citations