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Credence goods, experts and risk aversion

Bonroy, Olivier; Lemarié, Stéphane; Tropéano, … - In: Economics Letters 120 (2013) 3, pp. 464-467

-averse consumers. Our results show that the presence of risk aversion reduces the expert’s incentive to invest in diagnosis and may …The existing literature on credence goods and expert services has overlooked the importance of risk aversion. In this … paper we extend a standard expert model of credence goods with verifiable service quality by considering risk …

Persistent link: https://www.econbiz.de/10010681743

Product quality, advertising intensity and market size

Han, Bing; Chouinard, Hayley H. - In: Economics Letters 124 (2014) 2, pp. 215-218

We develop a model of product differentiation in which firms strategically compete in product quality and advertising intensity. Products exhibit a combination of vertical and horizontal differentiation. A consumer’s utility has a stochastic relationship with quality, but they are more likely...

Persistent link: https://www.econbiz.de/10010933282

Application compatibility and affiliation in two-sided markets

Maruyama, Masayoshi; Zennyo, Yusuke - In: Economics Letters 130 (2015) C, pp. 39-42

This paper analyzes the unilateral choices of application compatibility by platforms and the endogenous affiliations of two different groups (content providers and users). We find a novel result that for both platforms to unilaterally choose application compatibility is not an equilibrium unless...

Persistent link: https://www.econbiz.de/10011263393

Do food standards affect the quality of EU imports?

Olper, Alessandro; Curzi, Daniele; Pacca, Lucia - In: Economics Letters 122 (2014) 2, pp. 233-237

This paper investigates the relationship between the diffusion of EU standards and product quality upgrading using highly disaggregated import data to the EU in the food industry. Results show that, on average, the diffusion of EU voluntary standards boosts the rate of quality upgrading....

Persistent link: https://www.econbiz.de/10010743734

Free licensing to boost aggregate odds for success

Sorek, Gilad - In: Economics Letters 116 (2012) 2, pp. 183-185

We show how technological leader gains from inviting an entrant into R&D competition to improve over existing patented technology, as the entrant takes complementary R&D effort, and the demand for both current and improved technologies is increasing with aggregate probability for successful...

Persistent link: https://www.econbiz.de/10010597189

Standards vs. labels with imperfect competition and asymmetric information

Baltzer, Kenneth - In: Economics Letters 114 (2012) 1, pp. 61-63

I demonstrate that providing information about product quality is not necessarily the best way to address asymmetric information problems when markets are imperfectly competitive. In a vertical differentiation model I show that a Minimum Quality Standard, which retains asymmetric information,...

Persistent link: https://www.econbiz.de/10010597210

Transparency, entry, and productivity

Gu, Yiquan; Wenzel, Tobias - In: Economics Letters 115 (2012) 1, pp. 7-10

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.

Persistent link: https://www.econbiz.de/10010572133

Dissipative advertising signals quality: Static model with a continuum of types

Linnemer, Laurent - In: Economics Letters 114 (2012) 2, pp. 150-153

Advertising and price have been shown to signal product quality. Most works limit the number of types to high and low quality. I characterize the optimal separating marketing strategy when both quality and marginal cost are uncertain and continuous variables.

Persistent link: https://www.econbiz.de/10010572200

Optimal policy intervention, constrained obfuscation and the social value of public information

Colombo, Luca; Femminis, Gianluca - In: Economics Letters 123 (2014) 2, pp. 224-226

We study the welfare implications of public information precision in a beauty contest framework allowing for optimal stabilization policies and information obfuscation. When policy makers’ ability to obfuscate information is constrained, increasing public information precision can be welfare...

Persistent link: https://www.econbiz.de/10010906357

Biasing selection contests with ex-ante identical agents

Kawamura, Kohei; Moreno de Barreda, Inés - In: Economics Letters 123 (2014) 2, pp. 240-243

This note shows that when the designer of a contest wishes the winner have high ability, she is better off giving a head start to one of the contestants even if they are ex-ante identical. If the contestants are ex-ante asymmetric, the designer should give a head start to the one who is more...

Persistent link: https://www.econbiz.de/10010906360

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