Data and Code for: "Startup Search Costs"

Principal Investigator(s): View help for Principal Investigator(s) David Byrne, University of Melbourne; Nicolas de Roos, University of Sydney

Version: View help for Version V1

Name	File Type	Size	Last Modified
Data			11/16/2020 10:23:PM
figures			11/16/2020 10:27:PM
forexport			11/16/2020 10:23:PM
mFiles			11/16/2020 10:27:PM

Project Description

Summary: Workhorse economic models used for studying the market impacts of search frictions assume constant search costs: individuals pay the same cost to obtain price information each time they search. This paper provides evidence on a new form of search costs: startup costs. Exploiting a natural experiment in retail gasoline, we document how a temporary, large exogenous shock to consumers' search incentives leads to a substantial, permanent increase in price search. A standard search model fails to explain such history-dependence in search, while it follows directly from a model with a one-time up-front cost to start searching.

Scope of Project

Subject Terms: Search; Price Dispersion; Price War; Retail Gasoline

JEL Classification:
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
L81 Retail and Wholesale Trade; e-Commerce

Geographic Coverage: Perth, Australia

Methodology

Data Source: Pricing and Search Data: Fuelwatch
https://www.fuelwatch.wa.gov.au/fuelwatch/pages/public/historicalFileDownloadRetail.jspx

SA1, DZN Mapping Data: Australian Bureau of Statistics
https://www.abs.gov.au/websitedbs/d3310114.nsf/home/digital+boundaries

Unit(s) of Observation: Calendar date

Geographic Unit: Urban area

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Published Versions

V1 [2022-04-14]

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DDI 2.5

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