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Add-on Pricing, Naive Consumers, and the Hidden Welfare Costs of Education

Kosfeld, Michael; Schüwer, Ulrich - C.E.P.R. Discussion Papers - 2011

Previous research shows that firms shroud high add-on prices in competitive markets with naive consumers leading to inefficiency. We analyze the effects of regulatory intervention via educating naive consumers on equilibrium prices and welfare. Our model allows firms to shroud, unshroud, or...

Persistent link: https://www.econbiz.de/10009367427

Discount Pricing

Armstrong, Mark; Chen, Yongmin - C.E.P.R. Discussion Papers - 2013

We investigate the marketing practice of framing a price as a discount from an earlier price. We discuss two reasons why a discounted price---rather than a merely low price---can make a consumer more willing to purchase. First, a high initial price can indicate the product is high quality....

Persistent link: https://www.econbiz.de/10011083448

Vague Lies: How to Advise Consumers When They Complain

Drugov, Mikhail; Troya Martinez, Marta - C.E.P.R. Discussion Papers - 2012

This paper analyzes the incentives of a seller to provide (un)biased and (im)precise advice about a complex product such as insurance, banking and telecommunication services. Misleading the buyers by biasing the advice upwards increases the revenues but also the expected fine imposed by the...

Persistent link: https://www.econbiz.de/10011083992

Financial Advice and Stock Market Participation

Georgarakos, Dimitris; Inderst, Roman - C.E.P.R. Discussion Papers - 2014

We introduce professional financial advice in households’ choice to hold risky financial assets. Consistent with the predictions from a formal model, we present evidence that households’ trust in financial advice only matters when their perceived own financial capability is low. Instead, for...

Persistent link: https://www.econbiz.de/10011084072

Growth, Colonization, and Institutional Development: In and Out of Africa

Bertocchi, Graziella - C.E.P.R. Discussion Papers - 2011

This essay investigates the determinants of the growth performance of Africa. I start by illustrating a broader … institutional development. After reporting results from standard growth regressions, I analyze the role of Africa’s peculiar history … influence, in and out of Africa, of the slave trades. The essay ends with critical conclusions and suggestions for further …

Persistent link: https://www.econbiz.de/10009225960

Human Development in Africa: A Long-run Perspective

Prados de la Escosura, Leandro - C.E.P.R. Discussion Papers - 2011

Long-run trends in Africa’s well-being are provided on the basis of a new index of human development, alternative to … experienced in other developing regions. Within Africa, Sub-Saharan Africa has fallen steadily behind the North since mid-20th …

Persistent link: https://www.econbiz.de/10009322973

Evidence on the impact of minimum wage laws in an informal sector: Domestic workers in South Africa

Dinkelman, Taryn; Ranchhod, Vimal - C.E.P.R. Discussion Papers - 2011

South Africa and variation in the intensity of this law to identify increases in wages for domestic workers and find no …

Persistent link: https://www.econbiz.de/10009365006

Land deals in Africa: pioneers and speculators

Collier, Paul; Venables, Anthony J - C.E.P.R. Discussion Papers - 2011

Much African land currently has low productivity and has attracted investors purchasing (or leasing) land as a speculative option on higher future prices or productivity. If land deals are to be beneficial they need to induce productivity enhancing investments. Some of these will be publicly...

Persistent link: https://www.econbiz.de/10009367429

Growth, History, or Institutions? What Explains State Fragility in Sub-Saharan Africa

Bertocchi, Graziella; Guerzoni, Andrea - C.E.P.R. Discussion Papers - 2010

We explore the determinants of state fragility in sub-Saharan Africa. Controlling for a wide range of economic …

Persistent link: https://www.econbiz.de/10008468636

The vulnerability of sub-Saharan Africa to the financial crisis: the case of trade

Berman, Nicolas; Martin, Philippe - C.E.P.R. Discussion Papers - 2010

In the early stage of the 2008-2009 financial crisis, the conventional wisdom was that financial under-development of sub Saharan African economies may be a blessing in disguise because it insulates them from the direct effects of the crisis. This paper argues that this may also make African...

Persistent link: https://www.econbiz.de/10008530377