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Electronic commerce, consumer search and retailing cost reduction

By Cristina Mazón Calpena and Pedro Pereira

Abstract

This paper explains four things in a unified way. First, how e-commerce can generate price\ud equilibria, where physical shops either compete with virtual shops for consumers with Internet\ud access, or alternatively, sell only to consumers with no Internet access. Second, how these price\ud equilibria might involve price dispersion on-line. Third, why prices may be higher on-line. Fourth,\ud why established firms can, but need not, be more reluctant than newly created firms to adopt ecommerce.\ud For this purpose we develop a model where e-commerce reduces consumers’ search\ud costs, involves trade-offs for consumers, and reduces retailing costs.\ud \ud Se explica la competencia entre las tiendas físicas y las tiendas virtuales, concluyendose cómo el comercio electrónico reduce los costes de búsqueda de los consumidores, implica un "trade-off" para los consumidores, y disminuye los costes de producción de las empresas

Topics: Comercio
Publisher: Instituto Complutense de Análisis Económico
Year: 2001
OAI identifier: oai:www.ucm.es:6786
Provided by: EPrints Complutense

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