We consider duopoly sequential price competition between a low-cost online firm and a high-cost brick-and-mortar firm that decides whether to price-match the low-cost rival. We study how price-match guarantees affect the incentives of both firms to invest in cost reduction and quality enhancement. We find that price-match guarantees in our model weaken these incentives in most cases. Our research reveals more reasons to suspect that seemingly pro-competitive price-matching by many offline rivals to online sellers may have hidden social costs.

中文翻译：

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价格匹配保证和投资激励

我们考虑了低成本在线公司与高成本实体公司之间的双头垄断顺序价格竞争，该竞争决定了是否与低成本竞争对手进行价格匹配。我们研究了价格匹配担保如何影响两家公司投资于降低成本和提高质量的动机。我们发现，在大多数情况下，我们模型中的价格匹配担保会削弱这些激励措施。我们的研究揭示了更多理由怀疑，许多线下竞争对手对在线卖家的竞价竞争似乎具有潜在的社会成本。