EconPapers    
Economics at your fingertips  
 

Quality and Price Setting of High-Tech Goods

Yuriy Gorodnichenko, Oleksandr Talavera and Nam Vu ()
Additional contact information
Nam Vu: University of Birmingham

No 14058, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper investigates the link between product quality and price setting for central processing units (CPUs). Using thousands of price quotes from a popular price-comparison website, we find that market fundamentals, such as the number of sellers, median price, share of convenient prices and level of seller stability, are important factors for explaining price stickiness and price dispersion. We demonstrate that calculations of price inflation require conditioning not only on CPU quality, but also on market fundamentals to ensure that CPU attributes are priced correctly. Failing to do so can result in an understatement of CPU price deflation in the sample period.

Keywords: price setting; e-commerce; product quality; hedonic pricing; inflation (search for similar items in EconPapers)
JEL-codes: E31 L11 L81 L86 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2021-01
New Economics Papers: this item is included in nep-com, nep-ind and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://ftp.iza.org/dp14058.pdf (application/pdf)

Related works:
Journal Article: Quality and price setting of high-tech goods (2021) Downloads
Working Paper: Quality and Price Setting of High-Tech Goods (2021) Downloads
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:iza:izadps:dp14058

Ordering information: This working paper can be ordered from
IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany

Access Statistics for this paper

More papers in IZA Discussion Papers from Institute of Labor Economics (IZA) IZA, P.O. Box 7240, D-53072 Bonn, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Holger Hinte ().

 
Page updated 2021-10-23
Handle: RePEc:iza:izadps:dp14058