TY - JOUR
T1 - Price competition and the Bertrand model
T2 - the paradox of the German mobile discount market
AU - Kaimann, Daniel
AU - Hoyer, Britta
N1 - Funding Information:
This work was partially supported by the German Research Foundation (DFG) within the Collaborative Research Centre “On-The-Fly Computing” [SFB 901].
Publisher Copyright:
© 2018, © 2018 Informa UK Limited, trading as Taylor & Francis Group.
PY - 2019/1/2
Y1 - 2019/1/2
N2 - We investigate the degree of price competition among telecommunication firms. Underlying a Bertrand model of price competition, we empirically model pricing behaviour in an oligopoly. We analyse panel data of individual pricing information of mobile phone contracts offered between 2011 and 2017. We provide empirical evidence that price differences as well as reputational effects serve as a signal to buyers and significantly affect market demand. Additionally, we find that brands lead to an increase in demand and thus are able to generate spillover effects even after price increase.
AB - We investigate the degree of price competition among telecommunication firms. Underlying a Bertrand model of price competition, we empirically model pricing behaviour in an oligopoly. We analyse panel data of individual pricing information of mobile phone contracts offered between 2011 and 2017. We provide empirical evidence that price differences as well as reputational effects serve as a signal to buyers and significantly affect market demand. Additionally, we find that brands lead to an increase in demand and thus are able to generate spillover effects even after price increase.
UR - http://www.scopus.com/inward/record.url?scp=85041905584&partnerID=8YFLogxK
U2 - 10.1080/13504851.2018.1436141
DO - 10.1080/13504851.2018.1436141
M3 - Article
AN - SCOPUS:85041905584
VL - 26
SP - 54
EP - 57
JO - Applied Economics Letters
JF - Applied Economics Letters
SN - 1350-4851
IS - 1
ER -