Publications

“Non-reservation price equilibria and consumer search”, with Maarten C.W. Janssen, Alexei Parakhonyak, Journal of Economic Theory (2017) 172, pp. 120-162

Working Papers

“Showrooming in a market of tangible goods with heterogeneous agents”

Showrooming is a situation where consumers try products at brick-and-mortar stores before purchasing them online at a lower price. One way to prevent showrooming is to use a price matching policy, whereby price is the same in both the physical store and the online channel. We show that for small search costs, a price matching policy is indeed optimal. However for higher search costs price matching is suboptimal, and online and offline purchases coexist with showrooming. A firm which faces online competition from a foreign multichannel retailer has an incentive to geo-block, i.e. refuse to serve foreign customers, even though it leads to a decrease in potential demand. Geo-blocking relaxes online competition and leads to higher prices both online and in brick-and mortar stores. A legal price parity requirement helps to eliminate incentives to geo-block and thus restores online competition.

“Network Effects on Stock Market Participation” (with Olga Balakina)

This paper introduces an equilibrium model of stock market participation with a social network to study how information diffusion affects the decision to enter the stock market. In the model agents of different types exist within a social network structure and share information through social interactions. We show that the equilibrium participation level depends on the number of informed agents and the intensity of social interactions. We provide an algorithm for finding the equilibrium stock market participation for a particular network structure and use Danish registry data for the period 2010-2013 to test the hypothesis that connectivity affect stock market participation. Consistent with the predictions of the model we find that connectivity has a positive impact on stock market participation. Finally, we find that the model with social networks outperform standard models of stock market participation.

Research in Progress

“Free-riding and Word-of-Mouth Communication”

“How Fat are the Fingers? Investor Mistakes and Market Efficiency” (with Olga Balakina and Claes Backman)