How Increasing Supplier Search Cost Can Increase Welfare
Thierry Pénard
- Fonction : Auteur
- PersonId : 173138
- IdHAL : thierry-penard
- ORCID : 0000-0002-7903-0290
- IdRef : 061743194
Résumé
Reductions in search costs are generally found to increase efficiency and welfare. Using a simple search model we show that when an upstream firm incurs a search cost to identify a potential trading partner and the two parties then negotiate the wholesale price, a reduction in search cost can actually reduce welfare. Furthermore, in a market driven by seller search, a search cost of zero is never socially optimal.
Format du dépôt | Notice |
---|---|
Type de dépôt | Article dans une revue |
Titre |
en
How Increasing Supplier Search Cost Can Increase Welfare
|
Résumé |
en
Reductions in search costs are generally found to increase efficiency and welfare. Using a simple search model we show that when an upstream firm incurs a search cost to identify a potential trading partner and the two parties then negotiate the wholesale price, a reduction in search cost can actually reduce welfare. Furthermore, in a market driven by seller search, a search cost of zero is never socially optimal.
|
Auteur(s) |
Zhiwen Li
1
, Michael Arnold
2
, Thierry Pénard
3
1
School of management Jiangsu University
( 265117 )
- aSchool of Management, Jiangsu University, Zhenjiang, Jiangsu, China
- Chine
2
Alfred Lerner College of Business and Economics
( 535407 )
- États-Unis
3
CREM -
Centre de recherche en économie et management
( 894 )
- 7 place Hoche, BP 86514
35065 RENNES CEDEX
- France
|
Langue du document |
Anglais
|
Vulgarisation |
Non
|
Comité de lecture |
Oui
|
Audience |
Internationale
|
Date de publication |
2017-12-20
|
Volume |
18
|
Numéro |
1
|
Page/Identifiant |
online review
|
Nom de la revue |
|
Domaine(s) |
|
Mots-clés (JEL) |
|
Mots-clés |
en
Nash bargaining, sequential search, social welfare, search cost
|
DOI | 10.1515/bejte-2016-0048 |
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