Abstract
Pricing of transaction services in electronic financial markets has been undergoing a continuous change. The design of transaction fees plays a crucial role for the business structure of market places. A key element in price schedule design is the order behavior of the customers and their sensitivity to transaction fee changes. We conduct a field experiment as a means to analyze customers’ order behavior following transaction fee changes. The discussion highlights the need for a structured approach for price schedule design in the context of market engineering.
Keywords
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Oi, W.: A Disneyland Dilemma: Two-Part Tariffs for a Mickey Mouse Monopoly. Quarterly Journal of Economics 85, 77–96 (1971)
Ng, Y., Weisser, M.: Optimal Pricing With a Budget Constraint – The Case of the Two-Part Tariff. Review of Economic Studies 41, 337–445 (1974)
Leland, H.E., Meyer, R.A.: Monopoly Pricing Structures with Imperfect Discrimination. The Bell Journal of Economics 7(2), 449–462 (1976)
Goldman, B., Leland, H.E., Sibley, D.S.: Optimal Nonuniform Prices. Review of Economic Studies 52, 305–319 (1984)
Dolan, R.J.: Quantity Discounts: Managerial Issues and Research Opportunities. Marketing Science 6(1), 1–22 (1987)
Munson, C.L., Rosenblatt, M.J.: Theories and Realities of Quantity Discounts: An Exploratory Study. Production and Operations Management 7(4), 352–369 (1998)
Amihud, Y., Mendelsson, H.: Asset pricing and the bid-ask spread. Journal of Financial Economics 17, 223–249 (1986)
Umlauf, S.R.: Transaction taxes and the behavior of the Swedish stock market. Journal of Financial Economics 33, 227–240 (1993)
Jackson, P.D., O’Donnell, A.T.: The effects of stamp duty on equity transactions and prices in UK Stock Exchange. Unpublished working paper, Bank of England (1985)
Michaely, R., Vila, J.-L.: Trading Volume with Private Valuation: Evidence from the Ex-Dividend Day. Review of Financial Studies 9(2), 471–509 (1996)
Weinhardt, C., Holtmann, C., Neumann, D.: Market Engineering. Wirtschaftsinformatik 45(6), 635–640 (2003)
Moorthy, K.S.: Market Segmentation, Self-Selection, and Product Line Design. Marketing Science 3(4), 288–307 (1984)
Luckner, S., Schröder, J., Slamka, C.: On the Forecast Accuracy of Sports Prediction Markets. In: Gimpel, H., Jennings, N.R., Kersten, G.E., Ockenfels, A., Weinhardt, C. (eds.) Negotiation, Auctions, and Market Engineering. LNBIP, vol. 2, pp. 227–234. Springer, Heidelberg (2008)
Buchanan, J.M.: The Theory of Monopolistic Quantity Discounts. Review of Economic Studies 20(3), 199–208 (1953)
Sheskin, D.J.: Handbook of Parametric and Nonparametric Statistical Procedures, 3rd edn. Chapman & Hall/CRC (2004)
Wilson, R.B.: Nonlinear Pricing. Oxford University Press, New York, Oxford (1993)
Weinhardt, C., Neumann, D., Holtmann, C.: Computer-aided Market Engineering. Communications of the ACM 49(7) (2006)
Author information
Authors and Affiliations
Editor information
Rights and permissions
Copyright information
© 2008 Springer-Verlag Berlin Heidelberg
About this paper
Cite this paper
Burghardt, M. (2008). An Experiment on Investor Behavior in Markets with Nonlinear Transaction Fees. In: Gimpel, H., Jennings, N.R., Kersten, G.E., Ockenfels, A., Weinhardt, C. (eds) Negotiation, Auctions, and Market Engineering. Lecture Notes in Business Information Processing, vol 2. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-77554-6_10
Download citation
DOI: https://doi.org/10.1007/978-3-540-77554-6_10
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-540-77553-9
Online ISBN: 978-3-540-77554-6
eBook Packages: Computer ScienceComputer Science (R0)