Measuring Prices and Price Competition Online: Amazon.com and BarnesandNoble.com

Despite the interest in measuring price sensitivity of online consumers, most academic work on Internet commerce is hindered by a lack of data on quantity. In this paper we use publicly available data on the sales ranks of about 20,000 books to derive quantity proxies at the two leading online books...

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Veröffentlicht in:	Quantitative marketing and economics 2003-06, Vol.1 (2), p.203
Hauptverfasser:	Chevalier, Judith, Goolsbee, Austan
Format:	Artikel
Sprache:	eng
Schlagworte:	Bias Bookstores Competition Consumer Price Index Consumers Data mining Elasticity of demand Internet Price elasticity Retail stores
Online-Zugang:	Volltext
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Beschreibung
Zusammenfassung:	Despite the interest in measuring price sensitivity of online consumers, most academic work on Internet commerce is hindered by a lack of data on quantity. In this paper we use publicly available data on the sales ranks of about 20,000 books to derive quantity proxies at the two leading online booksellers. Matching this information to prices, we can directly estimate the elasticities of demand facing both merchants as well as create a price index for online books. The results show significant price sensitivity at both merchants but demand at BarnesandNoble.com is much more price-elastic than is demand at Amazon.com. The data also allow us to estimate the magnitude of bias in the CPI due to the rise of Internet sales.
ISSN:	1570-7156 1573-711X
DOI:	10.1023/A:1024634613982