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Algorithmic Pricing and Competition

BY | June 22, 2023

In this article we examine the impact of adoption of AI-driven algorithmic pricing software. Most of the recent academic work has studied this question from a theoretical or experimental perspective.…

In this article we examine the impact of adoption of AI-driven algorithmic pricing software. Most of the recent academic work has studied this question from a theoretical or experimental perspective. We describe the first empirical analysis of the consequences of wide-scale adoption of algorithmic pricing software, focusing on Germany’s retail gasoline market, where, according to trade publications, software became widely available in 2017. The evidence suggests that adoption increased margins

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