This paper revisits the relationship between transparency on the consumer side and product variety as analyzed in Schultz (2009). We identify two welfare effects of transparency. More transparency decreases price-cost margins which is beneficial forwelfare. On the other hand, more transparency...

This paper examines how delivery tariffs and private quality standards are determined in vertical relations that are subject to asymmetric information. We consider an infinitely repeated game where an upstream firm sells a product to a downstream firm. In each period, the firms negotiate a...

This paper studies the relationship between transparency on the consumer side and productivity of firms. We show that more transparent markets are characterized by higher average productivity as firms with low productivity abstain from entering these markets. -- Market Transparency ; Firm...

We explore the strategic role of private quality standards in food supply chains. Considering two symmetric retailers that are exclusively supplied by a finite number of producers and endogenizing the suppliers' delivery choice, we show that there exist two asymmetric equilibria in the...

It is increasingly observable that competitors in different industries share customer data, which can be used for targeted pricing. We propose a modified Hotelling model with two-dimensional consumer heterogeneity to analyze the incentives for such sharing and its ensuing welfare effects. We...

This paper studies whether credit constraints affect the decision of small and medium size enterprises (SMEs) to upgrade the quality of their exported output with respect to the one sold domestically. We use a detailed firm-level data-set on Italian SMEs reporting information on output...

We analyze how consumer myopia influences investment incentives into a technology that enables firms to track consumers' purchases and make targeted offers based on their preferences. In a two-period Hotelling setup firms may invest in customer-tracking technology. If a firm acquires the...

A wide range of media provide information on many products based on reviews or expert opinions. A natural question is, whether these reviews and expert opinions have any effect on sales. A small but growing literature in economics and marketing science deals with this issue, by testing the...

We investigate how firms' incentives to acquire customer data for targeted offers depend on its quality. A two-dimensional Hotelling model is proposed where consumers are heterogeneous both with respect to their locations and transportation cost parameters (flexibility). Firms have perfect data...

This paper investigates the existence of a possible media bias by analyzing the impact of automobile manufacturer's advertisements on automobile reviews in a leading German car magazine. By accounting for both endogeneity and sample selection using a two-step procedure, we find a positive impact...