Decision: One-Dimensional Prices

Hermann Simon and Martin Fassnacht
Additional contact information
Hermann Simon: Simon-Kucher & Partners Strategy and Marketing Consultants
Martin Fassnacht: WHU – Otto Beisheim School of Management, Chair of Marketing and Commerce

Chapter 5 in Price Management, 2019, pp 173-208 from Springer

Abstract: Abstract This chapter deals with decision-making for one-dimensional prices. In other words, it involves setting a price for one product in one period. Rigid processes such as cost-plus or competition-oriented pricing, which consider only one factor, are in widespread use in practice, but they are not up to the challenges and complexities of price setting. Comprehensive processes take all relevant factors, such as goals, volume effects, costs, and competitive behavior, into account in the price decision. With their help, one can derive general rules for optimal prices. The price in this case is an elasticity-dependent markup on marginal costs. In the case of an oligopoly, the complexity is greater because one must take competitive reaction into account. Signaling can be used to influence such reactions.

Date: 2019
References: Add references at CitEc
Citations:

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-319-99456-7_5

Ordering information: This item can be ordered from
http://www.springer.com/9783319994567

DOI: 10.1007/978-3-319-99456-7_5

Access Statistics for this chapter

More chapters in Springer Books from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().