David Weinstein, Columbia University. "The Impact of E-Commerce on Relative Prices and Consumer Welfare"

Department seminar. David Weinstein is a Professor at Columbia University. He will present the paper: "The Impact of E-Commerce on Relative Prices and Consumer Welfare". Co-authored by Yoon J. Jo and Misaki Matsumura.

Photo of David Weinstein

David Weinstein

Abstract: 

This paper examines the impact of e-commerce on pricing behav- ior and welfare. Using Japanese data, we find that the entry of e- commerce firms significantly raised the rate of intercity price conver- gence for goods sold intensively online, but not for other goods. E- commerce also lowered relative inflation rates for goods sold inten- sively online. We overcome endogeneity issues by using historical cat- alog sales as an instrument for e-commerce sales intensity. We esti- mate that reductions in price dispersion raised welfare by 0.3 percent. E-Commerce also lowered variety-adjusted prices on average by 0.9 percent, and more in cities with highly educated populations.

 

Full paper here (PDF)

 

Host: Inga Heiland and Karen Helene Ulltveit-Moe

Published Sep. 26, 2019 9:55 AM - Last modified Oct. 12, 2019 2:06 PM