About This Site

Conventional wisdom has it that the price information available to consumers on the Internet will lead to a form of competition in which only low-price firms survive. For instance, a November 20, 1999 article in The Economist suggested that

 “The explosive growth of the Internet promises a new age of perfectly competitive markets. With perfect information about prices and products at their fingertips, consumers can quickly and easily find the best deals. In this brave new world, retailers’ profit margins will be competed away, as they are all forced to price at cost.” (p. 112)

Our research, as well as the graphs displayed on our data tab, shows that pricing strategies for the online products we have been tracking have remained remarkably stable, despite the fact that that the number of US households with Internet access has more than tripled.

This site is named in honor John Forbes Nash Jr., the Nobel Laureate in economics (and inspiration for Hollywood's A Beautiful Mind) who revolutionized game theory and economics with his famous equilibrium concept.

A Nash equilibrium is a situation where no firm can gain by changing its strategy, given the strategies of its rivals. The Nash-equilibrium concept distinguishes economic pricing strategies from those proposed by many marketing and management consultants.

Managers wishing to maximize shareholder value should use the Nash-equilibrium approach to pricing because:

• It guarantees that your firm is doing the best it can in the market, given the strategies of rival firms;

• It guarantees that rivals cannot adversely affect your bottom line by profitably responding to your strategies.

The numbers reported in the tables and displayed in the graphs on the home page are based on ongoing academic research of Professors at Indiana University's Kelley School of Business and Berkeley's Haas Business School.

The various measures and indices reported on our site are based on the Nash equilibrium concept, and are leading indicators of the equilibrium level of competition in online retail markets.

The daily data summarized in the graphs represents over seven years of theoretical and empirical research. The data are updated daily, although the publicly viewable measures and indices are only posted to the site at the end of each week.

Please contact us if wish to inquire about obtaining access to daily measures and indices.