Transparency, Prices and Welfare with Imperfect Substitutes

Jan Boone and Jan Potters

No 3256, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Markets that are not completely transparent feature complex comparative statics with respect to the effect of number of firms, elasticity of substitution between goods and degree of transparency on equilibrium prices. The main result is that the following 'common wisdom' is incorrect: more transparent markets always feature lower prices, higher consumer welfare and lower price dispersion.

Keywords: transparency; Substitution; Prices (search for similar items in EconPapers)
JEL-codes: D40 L10 (search for similar items in EconPapers)
Date: 2002-03
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Citations: View citations in EconPapers (3)

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Working Paper: Transparency, Prices and Welfare with Imperfect Substitutes (2002)
Working Paper: Transparency, Prices and Welfare with Imperfect Substitutes (2002)
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