dc.contributor.author |
Miravete, Eugenio |
|
dc.date.accessioned |
2015-02-11T21:39:03Z |
|
dc.date.accessioned |
2022-07-06T22:46:02Z |
|
dc.date.available |
2015-02-11T21:39:03Z |
|
dc.date.available |
2022-07-06T22:46:02Z |
|
dc.date.copyright |
10/07/2007 |
|
dc.date.issued |
2007 |
|
dc.identifier.uri |
https://ir.wgtn.ac.nz/handle/123456789/19062 |
|
dc.description.abstract |
A particular tariff option is said to be foggy when another option or a combination of other tariff options offered by the same firm is always less expensive regardless of the usage profile of any customer. Alternatively tariff fogginess may refer to the whole set of tariff options and it is related to the low likelihood that a particular tariff option ends up being the least expensive one among those of a menu of tariff plans for an arbitrary distribution of usage patterns. This paper takes advantage of the exogenous entry of a second carrier in the early U.S. cellular telephone industry. It shows that competition induces firms to introduce mostly non-foggy options thus abandoning deceptive pricing strategies (fog lifting) aimed to profit from mistaken choices of consumers rather than softening competition through the use of foggy tactics (co-opetition). Results indicate that tariff fogginess is less severe with the entry of a second firm in the industry according to either definition of foggy pricing. Thus competition alone and in particular the tactics of entrants appears to correct deceptive pricing strategies although such correction does not necessarily occur immediately after the entry of a competitor but rather in the long run. Results are robust to the existence of individual uncertainty regarding future telephone usage when consumers sign up for a particular tariff plan |
en_NZ |
dc.format |
pdf |
en_NZ |
dc.language.iso |
en_NZ |
|
dc.publisher |
Te Herenga Waka—Victoria University of Wellington |
en_NZ |
dc.rights |
Permission to publish research outputs of the New Zealand Institute for the Study of Competition and Regulation has been granted to the Victoria University of Wellington Library. Refer to the permission letter in record: https://ir.wgtn.ac.nz/handle/123456789/18870 |
en_NZ |
dc.title |
The Doubtful Profitability of Foggy Pricing |
en_NZ |
dc.type |
Text |
en_NZ |
vuwschema.contributor.unit |
New Zealand Institute for the Study of Competition and Regulation |
en_NZ |
vuwschema.contributor.unit |
Victoria Business School: Orauariki |
en_NZ |
vuwschema.subject.anzsrcfor |
149999 Economics not elsewhere classified |
en_NZ |
vuwschema.type.vuw |
Working or Occasional Paper |
en_NZ |
vuwschema.subject.anzsrcforV2 |
389999 Other economics not elsewhere classified |
en_NZ |