Leaving the Tier: An Examination of Asymmetry in Pricing Patterns in Online High Tech Shops

We analytically illustrate that maximizing profit in a market with products that quickly degrade in price motivates market leaders to make both aggressive price increases and decreases that exceed that of the market followers, flipping between attempts to capitalize on their brand name and using capturing a large majority of the market. We examine 475,866 prices and 51,260 price changes for 810 high-tech products from 26 vendors over 283 days …