Pricing behavior of firms when consumers have an Imperfect Recall

Syed Hasan, Muhammad Subhani (), Amber Osman and Ayub Mehar
Authors registered in the RePEc Author Service: Muhammad Nayaz

MPRA Paper from University Library of Munich, Germany

Abstract: Operating in markets which include the characteristics of both the perfect and imperfect competitions has never been so easy for a firm, while setting an acceptable price. Various firms show various pricing behavior to generate and maximize revenues. This paper is an attempt to encompass pricing behaviors of firms when consumers have imperfect recall for the past prices of the products, while giving a thought to ponder that which of the behaviors has an optimal rationale when a firm sets market price for a commodity. The findings concludes that firms set prices as similar as monopolist when the consumers of their products have imperfect recall for price they offered already in yore.

Keywords: Imperfect recall; pricing behavior; monopolist; hotelling tradeoff (search for similar items in EconPapers)
JEL-codes: D11 M0 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-bec, nep-com and nep-hme
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:35682

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