We examine the decision to advertise a homogenous good. We show that the likelihood of inefficiently low advertising rests heavily on how one models the mechanism by which advertising affects demand. Regardless of this mechanism, however, there is always a lower bound of concentration below...

We examine the impact of targeted advertising on competition and welfare when advertising directly affects the consumer’s utility, as in Becker and Murphy (1993). We show that as targeted advertising becomes less costly, market concentration and prices increase. Yet consumer welfare also...

When advertising is a value-enhancing complement to consumption [Becker and Murphy (1993)], customization can permit firms to discriminate in advertising strategies, rather than in pricing. We investigate customized complementary advertising in a spatial model of horizontal differentiation. We...