Scandinavian Working Papers in Economics

Working Paper Series,
Research Institute of Industrial Economics

No 559: Pricing Strategies in E-Commerce: Bricks vs. Clicks

Richard Friberg (), Mattias Ganslandt () and Mikael Sandström ()
Additional contact information
Richard Friberg: Stockholm School of Economics, Postal: P.O. Box 6501, SE-113 83 Stockholm, Sweden
Mattias Ganslandt: The Research Institute of Industrial Economics, Postal: P.O. Box 55665, SE-102 15 Stockholm, Sweden
Mikael Sandström: Swedish Research Institute of Trade (HUI), Postal: SE-103 29 Stockholm, Sweden

Abstract: What is the impact of the increasing dominance of conventional firms in e-commerce? We use a simple model to show that retailers who only sell through Internet have lower on-line prices than retailers who also sell through conventional stores. This proposition is firmly supported by our empirical analysis which uses a rich data set covering the Swedish markets for books and CDs. On average, prices of these goods are 15 percent cheaper on Internet, but if a single item is bought transport costs will make it as expensive to buy over Internet as in a conventional store (if a basket of goods is bought it is some 10 percent cheaper on Internet since transport costs are fixed).

Keywords: Retail Pricing; Consumer Behavior; E-Commerce; Price Discrimination

JEL-codes: D12; D43; L11; L81

23 pages, June 21, 2001

Full text files

WP559.pdf PDF-file 

Download statistics

Questions (including download problems) about the papers in this series should be directed to Elisabeth Gustafsson ()
Report other problems with accessing this service to Sune Karlsson ().

This page generated on 2018-01-23 23:34:27.