Does Consumer Search Matter for Firm Markups?

dc.contributor.authorGwin, Carl R.
dc.date.accessioned2005-08-13T17:08:44Z
dc.date.available2005-08-13T17:08:44Z
dc.date.copyrightOctober 8, 2004
dc.date.issued2005-08-13T17:08:44Z
dc.description.abstractThis study investigates the relationship between consumer search costs, inflation, and firm markups in retail trade by employing actual measures of search cost. Consistent with theory, results indicate that markups can be higher if search costs are higher and increases in inflation lead to increases in markups if search costs are sufficiently high. Two competing hypotheses on the link between inflation and markups, namely consumer search costs and alternatively long-term seller/buyer contracts, are then evaluated. As long-term contracts are rare in retail trade, this study's results make it hard to justify studying how inflation impacts firm markups without considering search costs.en
dc.format.extent362348 bytes
dc.format.mimetypeapplication/pdf
dc.identifier.urihttp://hdl.handle.net/2104/317
dc.language.isoen_USen
dc.relation.ispartofseriesBaylorBusiness Economics: Working Papers Seriesen
dc.relation.ispartofseries2004-052-ECOen
dc.subjectInflationen
dc.subjectMarkupen
dc.subjectSearch Costen
dc.subjectJEL Classification: D40en
dc.subjectJEL Classification: D83en
dc.titleDoes Consumer Search Matter for Firm Markups?en
dc.typeWorking Paperen
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