We study a competitive market for a homogeneous good, in which the only uncertainty concerns the number of identical sellers, who are sampled by a finite Poisson process from a continuum of potential participants. It is shown that, in equilibrium, there is price dispersion. Specifically, prices...

In many industries, firms reward their customers for making referrals. We analyze the optimal policy mix of price, advertising intensity, and referral fee for a monopoly when buyers choose to what extent to refer other consumers to the firm. We find that the firm uses its referral fee, but not...

When physically similar products, of similar quality, are offered by retailers both online and offline, we often observe that the dispersion in prices of these products online is greater than the price dispersion offline. This observation runs counter to early theories that suggested price...

This research proposes an analytical model of the joint optimization of coupon face value and duration together with the product price, and determines the impact of coupon design on consumers’ redemption behavior. A model of rational forward-looking consumers’ redemption behavior is derived...

A service provider sells to homogenous risk-averse consumers through a two-part tariff. The consumers have uncertain tastes toward the service. They subscribe the service before the uncertainty resolves. In contrast with the common view that a monpolist's optimal two-part tariff for homogeneous...

Independent of the left-right model of ideological structure, genetically modified organisms (GMOs) in food and agriculture are resented across the political spectrum in Switzerland. In the absence of any real experience with genetically modified (GM) food but faced with continuous exposure to...

This paper aims to inform banks, consumers, researchers, consumer protection organizations and other stakeholders for the importance of these regulations as well as raising some other related issues to be addressed for the protection of mortgage loan consumers. In 2014, EU political reasoning...

Information frictions play a key role in an array of economic activities and are frequently incorporated into formal models as search costs. However, little is known about the underlying source of consumer search costs and how heterogeneous they are across consumers and markets. This paper...

Casual empiricism suggests higher quality is associated with greater variety. However, recent theoretical and empirical research has either not considered this link, or has been unable to establish unambiguous predictions about the relationship between quality and variety. In this paper we...

I analyze a market where there is a homogeneous good, which quality is chosen, and therefore known, by a single producer. Consumers do not know the quality of the good but they use their acquaintances in order to obtain information about it. Information transmission exhibits decay and consumers...