The ‘Price Paradox’and Counteracting Approaches in the E-Commerce Markets: Based on the Adverse Selection Theory

摘要

According to the view of the traditional microeconomics, the price dispersion in the e-commerce markets should descend along with the dropping of search cost. However, the correlative empirical studies reach a contrary opinion: there not only exist price dispersion in the e-commerce market, but also has larger dispersion degree than the traditional market, thereby gaining a ‘price paradox’ that is inconsistent with traditional economic principle. Based on the adverse selection resulting from information asymmetry of online product quality, this paper puts up a new interpretation about the ‘price paradox’. Finally, the paper probes into counteracting approaches to eliminate and decrease ‘price dispersion’ so that raise the trading efficiency in the e-commerce markets.