eBook - ePub
Price Setting
About this book
The prices of some products fluctuate dramatically, while others remain more constant. What accounts for these extreme differences?
Renowned economist Truman F. Bewley investigates and elucidates this puzzling problem. Its crux, he argues, is that differentiated product prices are usually stable, whereas the prices of undifferentiated products – for which buyers can easily find comparable substitutes – are often volatile. Although product differentiation gives producers market power, this power alone does not guarantee price stability. There are nearly undifferentiated products whose producers have market power yet for which prices are unstable. Weakness of product differentiation makes it so advantageous for producers to compete on price that they do so and forego the benefits and stability of price collusion. Producers of truly differentiated goods prefer to compete on product performance rather than price and find that reducing prices during recessions does little to increase demand.
Based on hundreds of interviews with businesspeople responsible for setting prices, Bewley's book is an unusual and groundbreaking work, with findings vital for economists, students, and policymakers.
Renowned economist Truman F. Bewley investigates and elucidates this puzzling problem. Its crux, he argues, is that differentiated product prices are usually stable, whereas the prices of undifferentiated products – for which buyers can easily find comparable substitutes – are often volatile. Although product differentiation gives producers market power, this power alone does not guarantee price stability. There are nearly undifferentiated products whose producers have market power yet for which prices are unstable. Weakness of product differentiation makes it so advantageous for producers to compete on price that they do so and forego the benefits and stability of price collusion. Producers of truly differentiated goods prefer to compete on product performance rather than price and find that reducing prices during recessions does little to increase demand.
Based on hundreds of interviews with businesspeople responsible for setting prices, Bewley's book is an unusual and groundbreaking work, with findings vital for economists, students, and policymakers.
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Yes, you can access Price Setting by Truman F. Bewley in PDF and/or ePUB format, as well as other popular books in Politics & International Relations & Political Ideologies. We have over one million books available in our catalogue for you to explore.
Information
Edition
1Subtopic
Political IdeologiesTable of contents
- Cover
- Table of Contents
- Title Page
- Copyright Page
- Acknowledgments
- 1 Introduction
- 2 The Pricing of Manufactured Goods
- 3 Retail Pricing
- 4 Restaurant Pricing
- 5 Pricing by Contract Manufacturers
- 6 Pricing in the Construction Industry
- 7 The Pricing of Cement
- 8 The Pricing of Commodity Lumber, Plywood, and Oriented Strand Board
- 9 The Pricing of Midwestern Food and Feed Grains
- 10 Conclusion
- Appendix
- References
- Index
- End User License Agreement