Transparency, Prices and Welfare with Imperfect Substitutes

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Abstract

Markets that are not completely transparent feature complex comparative statics with respect to the effect of number of firms, elasticity of substitution between goods and degree of transparency on equilibrium prices.The main result is that the following 'common wisdom' is incorrect: more transparent markets always feature lower prices, higher consumer welfare and lower price disperion.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages26
Volume2002-7
Publication statusPublished - 2002

Publication series

NameCentER Discussion Paper
Volume2002-7

Keywords

  • market structure
  • prices
  • welfare

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