Internet car retailing

Fiona Scott Morton*, Florian Zettelmeyer, Jorge Silva-Risso

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

166 Scopus citations

Abstract

We investigate the effect of Internet car referral services on dealer pricing of automobiles in California. Customers of an online service pay on average 2% less for their car ($450 for the average car). 25% of the savings come from purchasing at low-price dealerships affiliated with the online service. The remaining 75% stem from information provision by the online service, bargaining by the service on behalf of consumers, and cost efficiencies. A consumer receiving the mean online price does better than 65% of offline consumers, conditional on the car being purchased.

Original languageEnglish (US)
Pages (from-to)501-519
Number of pages19
JournalJournal of Industrial Economics
Volume49
Issue number4
DOIs
StatePublished - Dec 2001

ASJC Scopus subject areas

  • Accounting
  • Business, Management and Accounting(all)
  • Economics and Econometrics

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