A fair price to pay?
When you buy products online, do you imagine you could get better prices in a store? Conversely, does in-store shopping lead you to wonder whether you are missing better prices online? Fear not. An innovative study by an MIT economist shows that in 10 major countries, companies sell their wares at the same prices in stores and online, at the same moments, nearly three-quarters of the time. “We were a bit surprised by the numbers,” says Alberto Cavallo, the Douglas Drane Professor in Information Technology and Management at the MIT Sloan School of Management and author of a newly published paper on the subject. In his view, the level prices have a lot to do with companies wanting to seem “fair” to as many consumers as possible. “It has a lot to do with experience,” Cavallo adds. “I think what is driving much of this is consumers don’t think it’s fair when they see...