Reviews on Why Price Dispersions Exist in Electronic Markets: A Multi-Perspective Analytical Framework

Electronic markets are inter-organizational information systems that allow the buyers and sellers to exchange information about prices and product offerings, and have become the important virtual marketplaces matching transactions which play an increasing role on the physical markets and absorb eyeballs of researchers and practitioners. In this paper, we incorporate the proxies about price dispersion in electronic markets into the same analytical framework for research, examine the explaining strength of existing literature on electronic markets form different perspectives. Based on that, we point out that price dispersion phenomena in electronic markets result from comprehensive effects of many factors, and it is consumers' search heterogeneity, buyers' preferences including brand, trust and loyal degree factors, service differentiation and market structure characteristics that co-assume the degree of price dispersion, information value and efficiency.