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The Elasticities of Complementarity and Substitution

Broer, Peter - Tinbergen Instituut - 2004

This paper argues that the conventional definition of the elasticity of complementarity is not well suited to deal with the case of increasing returns. It proposes a slightly different formula, that uses a distance function formulation instead of a production function. The proposed definition...

Persistent link: https://www.econbiz.de/10011255597

Advertising for Attention in a Consumer Search Model

Haan, Marco A.; Moraga-Gonzalez, Jose Luis - Tinbergen Instituut - 2009

We model the idea that when consumers search for products, they first visit the firm whose advertising is more salient …. The gains a firm derives from being visited early increase in search costs, so equilibrium advertising increases as search … heterogeneity in advertising costs. Firms whose advertising is more salient and therefore raise attention more easily charge lower …

Persistent link: https://www.econbiz.de/10011255707

Platform Intermediation in a Market for Differentiated Products

Galeotti, Andrea; Moraga-Gonzalez, Jose Luis - Tinbergen Instituut - 2008

This discussion paper resulted in a publication in the <A href="http://www.sciencedirect.com/science/article/pii/S0014292108000810">European Economic Review</A>.<p>We study a two-sided market where a platform attracts firms selling differentiated products and buyers interested in those products. In the unique subgame perfect equilibrium of the game, the platform fully...</p></a>

Persistent link: https://www.econbiz.de/10011256378

Advertising and Consumer Search in a Duopoly Model

Janssen, Maarten C.W.; Non, Mariëlle C. - Tinbergen Instituut - 2005

. Information can come through two different channels: advertising and sequential consumer search. We arrive at the following … results. First, there is no monotone relationship between prices and the degree of advertising. Second, advertising and search … are “substitutes” for a large range of parameters. Third, when the cost of either search or advertising vanishes, the …

Persistent link: https://www.econbiz.de/10011256424

Targeted Advertising and Social Status

Vikander, Nick - Tinbergen Instituut - 2011

This paper shows how a firm can use non-targeted advertising to exploit consumers' desire for social status. A … monopolist sells multiple varieties of a good to consumers who each care about what others believe about his wealth. Advertising …

Persistent link: https://www.econbiz.de/10011257181