Ownership, location and prices in chinese electronic commerce markets

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. 2008 Elsevier B.V. All rights reserved. JEL classification: D40; L51; L81; L86