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Competitiveness And Price Convergence On The Internet: Evidence From The Online Dvd Market, Xiaolin Xing, Fang Fang Tang, Zhenlin Yang
Competitiveness And Price Convergence On The Internet: Evidence From The Online Dvd Market, Xiaolin Xing, Fang Fang Tang, Zhenlin Yang
Research Collection School Of Economics
We compare the pricing behavior between online branches of traditional retailers (MCR) and pure Internet retailers (Dotcom) in the DVD market. Based on a set of panel data from July 5, 2000 to June 11, 2001, we find that the average price of the MCRs is about 11.2% higher than that of the Dotcoms. Further statistical analyses on the market dynamics of price trends show that the prices of the Dotcoms went up with time much faster than the prices of the MCRs, which points to a possibility that eventually both types of retailers may charge similar prices on average. …