Download or read book Price Theory written by Milton Friedman and published by Walter de Gruyter GmbH & Co KG. This book was released on 2021-03-22 with total page 368 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Reference Price Theory written by Daniel Steven Putler and published by . This book was released on 1988 with total page 300 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Discovering Prices written by Paul Milgrom and published by Columbia University Press. This book was released on 2017-05-23 with total page 222 pages. Available in PDF, EPUB and Kindle. Book excerpt: Traditional economic theory studies idealized markets in which prices alone can guide efficient allocation, with no need for central organization. Such models build from Adam Smith’s famous concept of an invisible hand, which guides markets and renders regulation or interference largely unnecessary. Yet for many markets, prices alone are not enough to guide feasible and efficient outcomes, and regulation alone is not enough, either. Consider air traffic control at major airports. While prices could encourage airlines to take off and land at less congested times, prices alone do just part of the job; an air traffic control system is still indispensable to avoid disastrous consequences. With just an air traffic controller, however, limited resources can be wasted or poorly used. What’s needed in this and many other real-world cases is an auction system that can effectively reveal prices while still maintaining enough direct control to ensure that complex constraints are satisfied. In Discovering Prices, Paul Milgrom—the world’s most frequently cited academic expert on auction design—describes how auctions can be used to discover prices and guide efficient resource allocations, even when resources are diverse, constraints are critical, and market-clearing prices may not even exist. Economists have long understood that externalities and market power both necessitate market organization. In this book, Milgrom introduces complex constraints as another reason for market design. Both lively and technical, Milgrom roots his new theories in real-world examples (including the ambitious U.S. incentive auction of radio frequencies, whose design he led) and provides economists with crucial new tools for dealing with the world’s growing complex resource-allocation problems.

Download or read book Chicago Price Theory written by Sonia Jaffe and published by Princeton University Press. This book was released on 2019-09-10 with total page 248 pages. Available in PDF, EPUB and Kindle. Book excerpt: An authoritative textbook based on the legendary economics course taught at the University of Chicago Price theory is a powerful analytical toolkit for measuring, explaining, and predicting human behavior in the marketplace. This incisive textbook provides an essential introduction to the subject, offering a diverse array of practical methods that empower students to learn by doing. Based on Economics 301, the legendary PhD course taught at the University of Chicago, the book emphasizes the importance of applying price theory in order to master its concepts. Chicago Price Theory features immersive chapter-length examples such as addictive goods, urban-property pricing, the consequences of prohibition, the value of a statistical life, and occupational choice. It looks at human behavior in the aggregate of an industry, region, or demographic group, but also provides models of individuals when they offer insights about the aggregate. The book explains the surprising answers that price theory can provide to practical questions about taxation, education, the housing market, government subsidies, and much more. Emphasizes the application of price theory, enabling students to learn by doing Features chapter-length examples such as addictive goods, urban-property pricing, the consequences of prohibition, and the value of a statistical life Supported by video lectures taught by Kevin M. Murphy and Gary Becker The video course enables students to learn the theory at home and practice the applications in the classroom

Download or read book Pricing Strategy and the Formation and Evolution of Reference Price Perceptions in New Product Categories written by Benjamin Lowe and published by . This book was released on 2006 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract : This study examines how pioneer and follower pricing strategies affect the formation and evolution of reference price perceptions in new product categories. It contributes to our understanding of pricing new products by integrating two important research streams in the field of marketing - reference price theory and the theory of pioneer brand advantage. This is the first research to address reference price effects for radically new product categories. Prior research has focused solely on products in existing categories, typically in fast moving consumer goods categories. Using three experiments to causally establish the consequences of pioneer and follower pricing strategies on consumer perceptions, three critical research issues are addressed for the first time, consistent with calls for research in the literature: 1. Which reference price do consumers utilise in new product categories? 2. What is the role of consumer confidence in reference price for new product categories? 3. How do reference price perceptions form and evolve as a result of pioneer and follower pricing strategy? In the literature, a frequently cited issue is the fragmented operationalisation of reference price perceptions. With little theory to guide researchers in terms of which measures should be used, experiment 1 provides new theory, finding as hypothesised, that fair price perceptions as opposed to expected price perceptions are more likely to be evoked by consumers for new product categories. Experiment 1 also finds that using consumers' confidence in their reference price beliefs as an additional explanatory variable, does not improve over current reference price models. Overconfidence, a robust consumer behavioural phenomenon (Alba and Hutchinson 2000), might explain this result. Prior research has made several contributions to understanding reference price perceptions in established product categories. However, not much is known about how these reference price perceptions initially form and evolve. Experiments 2 and 3 address this gap by simulating an emerging market and examining the role of pioneership in shaping reference price perceptions. Experiment 2 found the pioneer, due to its perceptual prominence, is able to define the reference price and subsequently define perceptions of value. That is, the value consumers place on a product and their intentions to purchase the product are about the same whether the pioneer follows a penetration (initial low price) or skimming (initial high price) strategy. Experiment 3 extends experiment 2 by examining what happens in the emerging market when a follower brand enters. The follower enters at a large or small discount to the pioneer, and the pioneer completes its penetration or skimming strategy, converging to a 'regular' price. As predicted, the pioneer's initial price frames subsequent price and value perceptions, signifying the importance of the pioneer as a referent brand. Lower initial prices erode value perceptions, whereas higher initial prices substantiate value perceptions. The follower's pricing strategy does not have as much influence as the pioneer's pricing strategy. Other findings from experiment 3 related to reference price theory in general. Specifically, there was strong evidence of an averaging process when forming reference prices. This adds theory to the measurement debate about operationalising reference price as some past price such as last price paid or some average of past prices. Experiment 3 also provides a further measurement contribution by supporting the use of brand specific measures of reference price, rather than category based measures. More generally, because of the causal research design, this thesis provides strong evidence of the use of reference prices in consumer decision making: a key concern emphasised by one of the area's seminal articles (i.e., Kalyanaram and Winer 1995), which stresses the need to provide evidence that consumers actually use reference prices, and not just act as if they do.

Download or read book Issues in Pricing written by Timothy Michael Devinney and published by Free Press. This book was released on 1988 with total page 440 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Adaptation level Theory written by Harry Helson and published by . This book was released on 1964 with total page 758 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Profiling the Reference Price Consumer written by Sangkil Moon and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: Consumers have distinctive price responses that reflect the manner in which they process price information. Many retailers assume that consumers make purchase decisions by simply trading off product preferences with product prices. In contrast, reference price theory argues that consumers use psychologically encoded prices when making a choice. Because the market-level reaction to price depends on the way that consumers use price information, it is important for retailers to understand the extent to which consumers in a particular trading area rely on reference prices. Given this information, retailers are better able to develop optimal pricing policies. In this research, we develop a procedure which classifies individual households into one of three price response segments: a no reference price segment (NRP), a memory-based reference price segment (MBR), and a stimulus-based reference price segment (SBR). NRP consumers take prices as given; they do not compare prices to a reference value. In contrast, MBR and SBR consumers compare current price to a reference value to determine whether a price level is reasonable. MBR consumers base their reference on past prices, while SBR consumers base their reference on the current price of a focal brand. Based upon past research, we assume that this focal brand is the last brand used by the consumer. Both types of reference price mechanisms assume that some aspect of past choice behavior (prices or product selection) impacts the current decision. For this reason, past marketing activity affects current purchase behavior whenever consumers rely on reference prices. We classify consumers into reference price segments using purchase histories of consumers in the toilet tissue product category. Significantly, our results clearly show that reference price consumers (MBR and SBR) constitute the vast majority of the market. In choosing a brand, both MBR and SBR consumers exhibit a characteristic known as loss aversion: they have a strong negative reaction to prices above the reference price and a weaker positive reaction to prices below the reference price. We find that MBR consumers, who recall prices from memory, are considerably more price and promotion responsive than SBR consumers, who rely entirely on price information available at the point of purchase. Our analysis shows that MBR consumers (relative to SBR consumers) pay lower prices, switch brands more frequently, and buy more often under promotional conditions. We believe that this difference occurs because MBR consumers continually monitor the pricing environment and buy when pricing conditions are favorable. Our work implies that MBR and SBR consumers will react differently to retail pricing policies. For example, we would expect that frequent promotions created by a HI-LO retailer would create an alternating pattern of positive and negative impacts for MBR consumers (due to perceived gains and losses over time). However, the impact of these HI-LO promotions on the SBR consumer depends on the depth of the discount: only those promotions that generate prices below the price level of the focal brand will have an effect. In contrast, an EDLP retailer minimizes the gain/loss mechanism of MBR consumers due to infrequent promotions. However, by choosing the price levels of the product category assortment carefully, the same EDLP retailer can ensure that all SBR consumers have a variety of products with reasonable prices, regardless of the identity of the focal brand. In choosing a retail pricing strategy (such as HI-LO versus EDLP), the retailer must take into account the intensity of retail competition, the extent to which the retailer has power in the distribution channel, and the purchase behavior characteristics of consumers in the trading area. However, all else being equal, we would expect the retailer facing a market dominated by MBR consumers would wish to alternate promotions on different brands over time and to publicize this information through advertising. This would ensure that consumers always find a brand whose price falls below its reference value. In contrast, a retailer facing a market dominated by SBR consumers can expect that a heavily promoted brand in one week will become the focal brand in future weeks. Thus, brands priced below the usual price level of this focal brand will benefit from past promotional activity, while brands priced above this focal brand will be hurt. For this reason, the retailer facing SBR consumers should confine promotions to the higher priced items in the category. By providing an analytical tool for understanding the reference price characteristics of the consumer population, our work allows the retailer to forecast the likely impact of changes in pricing policy.

Download or read book Financial Asset Pricing Theory written by Claus Munk and published by Oxford University Press, USA. This book was released on 2013-04-18 with total page 598 pages. Available in PDF, EPUB and Kindle. Book excerpt: The book presents models for the pricing of financial assets such as stocks, bonds, and options. The models are formulated and analyzed using concepts and techniques from mathematics and probability theory. It presents important classic models and some recent 'state-of-the-art' models that outperform the classics.

Download or read book 21st Century Economics A Reference Handbook written by Rhona C. Free and published by SAGE Publications. This book was released on 2010-05-14 with total page 1038 pages. Available in PDF, EPUB and Kindle. Book excerpt: Interest in economics is at an all-time high. Among the challenges facing the nation is an economy with rapidly rising unemployment, failures of major businesses and industries, and continued dependence on oil with its wildly fluctuating price. Economists have dealt with such questions for generations, but they have taken on new meaning and significance. Tackling these questions and encompassing analysis of traditional economic theory and topics as well as those that economists have only more recently addressed, 21st Century Economics: A Reference Handbook is a must-have reference resource. Key Features Provides highly readable summaries of theory and models in key areas of micro and macroeconomics, helpful for students trying to get a "big picture" sense of the field Includes introductions to relevant theory as well as empirical evidence, useful for readers interested in learning about economic analysis of an issue as well for students embarking on research projects Features chapters focused on cutting-edge topics with appeal for economists seeking to learn about extensions of analysis into new areas as well as new approaches Presents models in graphical format and summarizes empirical evidence in ways that do not require much background in statistics or econometrics, so as to maximize accessibility to students

Download or read book Theory of Financial Risk and Derivative Pricing written by Jean-Philippe Bouchaud and published by Cambridge University Press. This book was released on 2003-12-11 with total page 410 pages. Available in PDF, EPUB and Kindle. Book excerpt: Risk control and derivative pricing have become of major concern to financial institutions, and there is a real need for adequate statistical tools to measure and anticipate the amplitude of the potential moves of the financial markets. Summarising theoretical developments in the field, this 2003 second edition has been substantially expanded. Additional chapters now cover stochastic processes, Monte-Carlo methods, Black-Scholes theory, the theory of the yield curve, and Minority Game. There are discussions on aspects of data analysis, financial products, non-linear correlations, and herding, feedback and agent based models. This book has become a classic reference for graduate students and researchers working in econophysics and mathematical finance, and for quantitative analysts working on risk management, derivative pricing and quantitative trading strategies.

Download or read book Price Theory written by Milton Friedman and published by Routledge. This book was released on 2017-07-12 with total page 377 pages. Available in PDF, EPUB and Kindle. Book excerpt: Economics is sometimes divided into two parts: positive economics and normative economics. The former deals with how the economic problem is solved, while the latter deals with how the economic problem should be solved. The effects of price or rent control on the distribution of income are problems of positive economics. The desirability of these effects on income distribution is a problem of normative economics. Within economics, the major division is between monetary theory and price theory. Monetary theory deals with the level of prices in general, with cyclical and other fluctuations in total output, total employment, and the like. Price theory deals with the allocation of resources among different uses, the price of one item relative to another. Prices do three kinds of things. They transmit information, they provide an incentive to users of resources to be guided by this information, and they provide an incentive to owners of resources to follow this information. Milton Friedman's classic book provides the theoretical underpinning for and understanding of prices. Economics is not concerned solely with economic problems. It is a social science, and is therefore concerned primarily with those economic problems whose solutions involve the cooperation and interaction of different individuals. It is concerned with problems involving a single individual only insofar as the individual's behavior has implications for or effects upon other individuals. Price Theory is concerned not with economic problems in the abstract, but with how a particular society solves its economic problems.

Download or read book Inference Not Reference written by Ryan Hamilton and published by . This book was released on 2019 with total page 58 pages. Available in PDF, EPUB and Kindle. Book excerpt: Reference price theories have dominated research into how consumers evaluate prices and make price-based choices. Given the widespread acceptance of reference price theories, it is notable that so little consideration has been given to what happens when the central assumption of these theories is violated: how do consumers evaluate prices when they do not have stable, well-defined reference prices? The authors propose an alternative to reference price theories, in which consumers instead use a general cue, specifically, a retailer's price image, or overall reputation for charging high or low prices, as a top-down inferential heuristic. This alternative account predicts a pattern of price perceptions, price estimates, and choices that cannot be accounted for using prevailing reference price theories. In each of the domains, reference price theories either predict no differences based on retailer price images or predict the opposite of the reported findings. These predictions are tested against those of prevailing reference price accounts in a series of nine empirical studies that offer converging evidence in support of the proposed theory.

Download or read book Dynamic Asset Pricing Theory written by Darrell Duffie and published by Princeton University Press. This book was released on 2010-01-27 with total page 488 pages. Available in PDF, EPUB and Kindle. Book excerpt: This is a thoroughly updated edition of Dynamic Asset Pricing Theory, the standard text for doctoral students and researchers on the theory of asset pricing and portfolio selection in multiperiod settings under uncertainty. The asset pricing results are based on the three increasingly restrictive assumptions: absence of arbitrage, single-agent optimality, and equilibrium. These results are unified with two key concepts, state prices and martingales. Technicalities are given relatively little emphasis, so as to draw connections between these concepts and to make plain the similarities between discrete and continuous-time models. Readers will be particularly intrigued by this latest edition's most significant new feature: a chapter on corporate securities that offers alternative approaches to the valuation of corporate debt. Also, while much of the continuous-time portion of the theory is based on Brownian motion, this third edition introduces jumps--for example, those associated with Poisson arrivals--in order to accommodate surprise events such as bond defaults. Applications include term-structure models, derivative valuation, and hedging methods. Numerical methods covered include Monte Carlo simulation and finite-difference solutions for partial differential equations. Each chapter provides extensive problem exercises and notes to the literature. A system of appendixes reviews the necessary mathematical concepts. And references have been updated throughout. With this new edition, Dynamic Asset Pricing Theory remains at the head of the field.

Download or read book Price Theory and Its Uses written by Donald Stevenson Watson and published by . This book was released on 1981 with total page 618 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recognized for its clear writing style, this successful and carefully organized text takes the student step by step through the important themes of neoclassical microeconomics. It features a variety of applications, numerical illustrations and graphs with detailed captions. Each chapter has description diagrams, applications, problems and exercises, ending with a summary and selected references. Intended for intermediate price theory and intermediate microeconomics courses. This edition was published in 1981 by Houghton Mifflin Company.

Download or read book The Theory of Public Utility Pricing written by Stephen J. Brown and published by Cambridge University Press. This book was released on 1986-02-28 with total page 272 pages. Available in PDF, EPUB and Kindle. Book excerpt: Debate about deregulation has focused considerable attention on the pricing policies of public utilities. Much work has been done by economists on this subject, and in this book the results of that research are presented and made accessible to students of economics. The main subject is the policy to be followed by a regulated monopoly, but the analysis is broadened to take account of a fringe of competitive suppliers, making it relevant to electric utilities and local telephone companies in the US, to PTT's in Europe, to the possible privatisatibn of telecommunications in Australia, and to the telecommunications structure in the UK where the dominant supplier has recently been privatised. The book gives a unified and simplified exposition of the modern theory of efficient pricing which is not available elsewhere. The theoretical discussion is supplemented by numerical simulation comparing Fully Distributed Cost Pricing, Ramsey Pricing, and Optimal Non-uniform Pricing.

Download or read book The Applied Theory of Price written by Deirdre N. McCloskey and published by . This book was released on 1985 with total page 662 pages. Available in PDF, EPUB and Kindle. Book excerpt: