RESEARCH ARTICLE ELECTRONIC MARKETPLACES AND PRICE TRANSPARENCY: STRATEGY, INFORMATION TECHNOLOGY, AND SUCCESS1

Electronic marketplaces (EMPs) are widely assumed to increase price transparency and hence lower product prices. Results of empirical studies have been mixed, with several 1Carol Saunders was the accepting senior editor for this paper. Vivek Choudhury was the associate editor. Michael Barrett, Jan Damsgaard, and Joni Jones served as reviewers. studies showing that product prices have not decreased and others showing that prices have increased in some cases. One explanation is that sellers prefer not to join EMPs with high price transparency, leading highly price transparent EMPs to fail. Therefore, in order to be successful, EMPs might be expected to avoid high price transparency. But that strategy creates a catch-22 for EMPs on the buy side: Why would buyers want to join EMPs in the absence of pric