Title of article
Marketshareandpricerigidity$
Author/Authors
Isaac Kleshchelski، نويسنده ,
Issue Information
روزنامه با شماره پیاپی سال 2008
Pages
9
From page
344
To page
352
Abstract
Survey evidenceshowsthatthemainreasonwhyfirmskeeppricesstableisthatthey
are concernedaboutlosingcustomersormarketshare.Weconstructageneral
equilibriummodelinwhichfirmscareaboutthesizeoftheircustomerbase.Firmsand
customers formlong-termrelationshipsbecauseconsumersincurcoststoswitch
sellers.Inanenvironmentwithsectoralproductivityshocks,weshowthatcostpass-
throughisanon-monotonicfunctionofthesizeofswitchingcosts.Specifically,prices
tend tobecomemorestableasthefractionofrepeatcustomersincreasesandthe
elasticityofthecustomerbasefalls
Keywords
Price rigidityMarket shareCustomer relationsRealrigidities
Journal title
Journal of Monetary Economics
Serial Year
2008
Journal title
Journal of Monetary Economics
Record number
846297
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