مالکیت، مکان و قیمت ها در بازارهای تجارت الکترونیک چین

This study examines the pricing behavior of online retailers (e-tailers) in Chinese e-commerce markets. Descriptive statistics indicate that prices have not converged in China’s e-commerce markets and that there is relatively more price variation in markets for cosmetics, compact discs, gifts and books. Fixed effects model estimates show that e-tailer’s characteristics are significant determinants of prices. These findings are consistent with studies of “Western markets” that show e-tailer product offerings through the Internet may not be the same, even when their underlying attributes are. We also find ownership structure and “location” to be an important source of price differences between e-tailers.

How does the widespread availability of information on the Internet affect retail prices in electronic commerce (e-commerce) markets? With reduced search costs and better informed consumers, standard economic theory predicts that prices by online retailers (e-tailers) would converge to the same low level for goods with the same product attributes. Moreover, because of the easiness of finding different sellers online, one may think that the “location” of a seller would no longer matter in the online market. Initial empirical evidence has not found strong support for these predictions.1Bailey, 1998 and Clay et al., 2002 find that prices in United States (US) e-commerce markets are at least as high as those in physical markets, while Brynjolfsson and Smith, 2000, Clemons et al., 2002, Pan et al., 2002a and Pan et al., 2004 find greater price dispersion. Greenwald and Kephart (1999) and Brynjolfsson and Smith provide evidence that is consistent with e-tailers with strong customer awareness setting higher prices than lesser known e-tailers. These findings are typically explained by market immaturity and disequilibrium during the initial diffusion of e-commerce, and heterogeneity in the trust consumers have for e-tailers. However, Baye et al. (2004) find little evidence to support the disequilibrium explanation and instead find persistent price dispersion that depends on market structure measured by the number of listed firms. Other studies on price levels and elasticities suggest that some e-commerce markets are becoming more efficient (Ellison and Ellison, 2001, Brown and Goolsbee, 2002 and Pan et al., 2002b). However, Pan et al. (2003) continue to show the effects of reliability in fulfillment, trust and consumer awareness on the price level are ambiguous. Because most of this evidence is from Europe and the US, it is not clear how these results generalize to less-developed markets. This study makes two contributions to the existing literature. First, we expand the empirical analysis of e-commerce markets to a transition economy by examining the pricing behavior of Chinese e-tailers. Second, we examine whether prices at government, and foreign, owned e-tailers are different to prices at other e-tailers. To examine e-tailer behavior, we gathered price data for 535 product items from 93 e-tailer web sites during July, 2004. The dataset consists of 6316 observations for nine product categories: books; compact discs; laptop computers; gifts; cosmetics; digital video cameras; digital cameras; MP3 music players; and cellular telephones. We follow the general approach of Brynjolfsson and Smith, 2000, Clay et al., 2002, Pan et al., 2002a and Pan et al., 2002b by using these data to investigate: (i) whether the widespread availability of information has resulted in e-tailer price convergence; and (ii) in the event of no convergence, the extent to which price variation can be explained by product differentiation. However, in contrast to these studies, we investigate these questions for several product categories in a transition economy, and collect data directly from e-tailer’s web sites and by telephone survey. Results from descriptive statistics indicate that prices have not converged in China’s e-commerce markets and that there is relatively more price variation in markets for cosmetics, compact discs, gifts and books. Fixed effects model estimates show that e-tailer’s characteristics are significant determinants of prices. These findings are consistent with previous studies of “Western markets” that show e-tailer product offerings through the Internet may not be the same, even when their underlying attributes are. This suggests that while it is easier to obtain price information online, e-commerce may also exacerbate information asymmetry about product quality, since the buyer cannot physically inspect the product before purchase. We also find ownership structure and “location” to be an important source of price differences between e-tailers. On average, government-owned e-tailers charge about an 11% price premium in e-commerce markets, while e-tailers with foreign affiliations or without a physical store (i.e., pure-play e-tailers) must discount prices. The paper is organized as follows. Section 2 provides background on the Internet and e-commerce in China. Section 3 outlines the empirical model and hypotheses about online pricing behavior, and describes the data used to test our hypotheses. Estimation results are discussed in Section 4, and Section 5 concludes.

Using data for 535 product items, obtained from 93 web sites during July, 2004, we investigate whether the widespread availability of information on the Internet has resulted in price convergence in Chinese e-commerce markets. After controlling for different attribute levels within each product item, our results indicate that prices for books, compact discs, laptop computers, gifts, cosmetics, digital video cameras, digital cameras and MP3 music players have not converged in China’s e-commerce markets. The empirical finding that e-tailers charge different prices for a good with the same product attributes suggests that competition is evolving, in part, along non-price dimensions. Given that the Chinese market would be expected to operate very differently to markets in Europe and the US, the fact that our results are remarkably consistent with similar empirical analyses for these countries suggests that observed price dispersion is a reasonably robust result. We employ an econometric model to investigate the extent to which e-tailer price variation can be explained by product differentiation, focusing on firm ownership and location differences. Model estimates show that third-party certification and prominent links from other trustworthy web sites, respectively, do not correlate well with prices. This indicates that reputational information obtained from others (i.e., indirect reciprocity) does not translate into a price premium for Chinese e-tailers. In contrast, ownership structure appears to be an important source of observed price differences between e-tailers. One possible explanation for this result is that information obtained directly from e-tailer characteristics (i.e., direct reciprocity) can convey an important signal about reputation to consumers. Here, government-owned e-tailers leverage their reputation established in traditional markets into a price premium in e-commerce markets, while “less-reputable” e-tailers with foreign affiliations or without a physical store must discount prices. Other explanations of how ownership structure affects prices are possible. For example, state enterprises could charge systematically higher prices because: their costs associated with maintaining physical stores and inventories may be higher; they may be using the Internet primarily as an advertising devise in order to attract customers to their physical stores – and thus are afraid of cannibalizing their traditional market; they may be attracting less price elastic consumers; or consumers less comfortable searching the Internet for alternative suppliers. Also, the lower prices for multinationals could be due to their attempt to engage in a penetration pricing strategy. Future research should test the robustness of this study’s results to other transition economies and alternative (independent) measures for the reputation of state and foreign enterprises. Consistent with empirical evidence from Europe and the US, this study also finds that e-tailers without a physical store tend to price lower than e-tailers with a physical store. However, it is not entirely clear whether this reflects a reputation effect, or a joint-pricing effect where an e-tailer with a physical store prices less aggressively (or, higher, relative to those without a store) because it accounts for the potential negative effect of lower online prices on sales at its physical store. Prices and sale quantities from online and physical markets are required to identify these effects in the data.