This study aims to investigate the effects of market commonality and resource similarity on price competition and the recursive consequences in the Korean lodging market. Price comparison among hotels in the same geographic market has been facilitated through the development of information technology, rendering little search cost of consumers. While the literature implies the heterogeneous price attack and response among hotels, a limited number of empirical researches focus on the asymmetric and recursive pattern in the competitive dynamics. This study empirically examines the price interactions in the Korean lodging market based on the theoretical framework of competitive price interactions and countervailing power. Demonstrating superiority to the spatial lag model and the ordinary least squares in the estimation, the results from spatial error model suggest that the hotels with longer operational history pose an asymmetric impact on the price of the newer hotels. The asymmetry is also found in chain hotels over the independent, further implying the possibility of predatory pricing. The findings of this study provide the evidence of a hierarchical structure in the price competition, with different countervailing power by the resources of the hotels. Theoretical and managerial implications are discussed, with suggestions for future study.

Abstract
1. Introduction
2. Theoretical Background
    2.1. Competitive dynamics and countervailingpower
    2.2. Dynamic price interactions among hotels
3. Methodology
    3.1. Model and variables
    3.2. Sample and data
4. Findings and Discussion
5. Conclusion
References

• Unji BAEK(Tourism Industry Data Analytics Lab (TIDAL), Sejong University)
• Youngseok SIM(College of Hospitality and Tourism Management, Sejong University)
• Seul-Ki LEE(Department of Hotel and Tourism Management, Sejong University) Corresponding Author