An agent-based model of price flexing by chain-store retailers

Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F00216224%3A14560%2F12%3A00060881" target="_blank" >RIV/00216224:14560/12:00060881 - isvavai.cz</a>
Result on the web
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DOI - Digital Object Identifier
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Result language
angličtina
Original language name
An agent-based model of price flexing by chain-store retailers
Original language description
This paper investigates the effects of local price flexing on market structure and welfare in the supermarket sector. It presents an agent-based model of a~sector with two chain-store retailers in which the number and location of stores and prices charged by the stores are determined endogenously. The outcome in which all the stores within each chain charge the same price is compared to the situation in which each store sets prices according to local market conditions. The paper finds that local pricingreduces the number of stores and total welfare in the market. Furthermore, local pricing is more likely to increase the average prices and total revenue in the market, if the reservation price of consumers is high relative to the equilibrium price underuniform pricing. In this situation, local pricing is likely to reduce not only total welfare but also aggregate consumer surplus in the market.
Czech name
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Czech description
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Publication year
2012
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Article name in the collection
Proceedings of the 30th International Conference Mathematical Methods in Economics 2012
ISBN
9788072487790
ISSN
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e-ISSN
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Number of pages
6
Pages from-to
461-466
Publisher name
Silesian University in Opava, School of Business Administration in Karviná
Place of publication
Karviná
Event location
Karviná
Event date
Sep 11, 2012
Type of event by nationality
EUR - Evropská akce
UT code for WoS article
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