Price dispersion in oligopoly

Chaim Fershtman*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

6 Scopus citations


In the world of perfect markets consumers are assumed to respond instantly to every small price change. However, in the real world it is not clear that any small price change will have a great impact on consumers' decisions and that, regardless of their habit, they will shift from one brand to the other. The purpose of this paper is to examine oligopolistic price competition under the assumption that consumers are non-responsive to small price differences. The paper proves the existence of equilibrium in which firms do not necessarily charge the same price; however some of the firms charge their monopolistic price and others charge prices close to that price.

Original languageEnglish
Pages (from-to)389-401
Number of pages13
JournalJournal of Economic Behavior and Organization
Issue number4
StatePublished - Dec 1982
Externally publishedYes


Dive into the research topics of 'Price dispersion in oligopoly'. Together they form a unique fingerprint.

Cite this