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Chapter 4. Advertising in Markets
Renault, Régis - 2015
quality signaling or as a coordination device is described and discussed. The chapter then moves on to an analysis of the …
Persistent link: https://www.econbiz.de/10014025249
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Adverse Selection Without Single Crossing
Schottmüller, Christoph - 2012
The single crossing assumption simplifies the analysis of screening models as local incentive compatibility becomes sufficient for global incentive compatibility. If single crossing is violated, global incentive compatibility constraints have to be taken into account. This paper studies monotone...
Persistent link: https://www.econbiz.de/10013113458
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Does Costly Persuasion Signal Quality?
Carroni, Elias - 2020
This article investigates how a privately-informed seller could signal her type by gathering information about the buyer's match value. We study two alternative ways to obtain information. In the first one, labeled information acquisition, the seller can acquire exogenous signals by facing a...
Persistent link: https://www.econbiz.de/10012823542
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Screening with Under-Utilization : Tiers, Multi-Part Tariffs, and Welfare Implications
Corrao, Roberto; Flynn, Joel P.; Sastry, Karthik - 2021
We study a screening model in which agents can under-utilize goods. We characterize implementable and optimal contracts and show that, whenever the principal values usage instrumentally, the optimal menu involves multi-part tariffs with tiers of zero marginal prices. We apply our results to...
Persistent link: https://www.econbiz.de/10013235451
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Rationing Capacity in Advance Selling to Signal Quality
Yu, Man - 2013
product quality.We characterize the seller's signaling strategy and find that rationing of capacity in the advance period is … an effective tool of signaling product quality. We find that the high-quality seller can distinguish herself by … allocating less capacity than the low-quality seller in the advance period. We show that this signaling mechanism exists whenever …
Persistent link: https://www.econbiz.de/10013077464
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Zero-debt policy under asymmetric information, flexibility and free cash flow considerations
Miglo, Anton - In: Journal of risk and financial management : JRFM 13 (2020) 12/296, pp. 1-25
We build a model of debt for firms with investment projects, for which flexibility and free cash flow problems are important issues. We focus on the factors that lead the firm to select the zero-debt policy. Our model provides an explanation of the so-called "zero-leverage puzzle". It also helps...
Persistent link: https://www.econbiz.de/10012392204
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Screening without Single Crossing
Kwak, Changhyun - 2023
This paper provides a sufficient condition under which a general screening problem can be reduced, without the principal’s payoff loss, to one with the single crossing property. The sufficient condition requires the agent’s types to be ordered in a way that two marginal rates of substitution...
Persistent link: https://www.econbiz.de/10014346954
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Rational Signals of Weakness in a Market Entry Game
Kamphorst, Jurjen J.A. - 2013
It is well-established that incumbent firms may try to deter new market entry by pretending to be stronger than they really are (e.g. by imitating the high output level of a low cost monopolist). In this article, we show that in some cases an incumbent may prefer the opposite, namely to...
Persistent link: https://www.econbiz.de/10013094960
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Crowdfunding in a competitive environment
Miglo, Anton - In: Journal of risk and financial management : JRFM 13 (2020) 3/39, pp. 1-38
Crowdfunding has mostly been used to finance very unique projects. Recently, however, companies have begun using it to finance more traditional products where they compete against other sellers of similar products. Major crowdfunding platforms, Kickstarter and Indiegogo, as well as Amazon have...
Persistent link: https://www.econbiz.de/10012174171
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Money talks? : an experimental investigation of cheap talk and burned money
Haan, Thomas de; Offerman, Theo; Sloof, Randolph - 2011
We experimentally study the strategic transmission of information in a setting where both cheap talk and money can be used for communication purposes. Theoretically a large number of equilibria exist side by side, in which senders either use costless messages, money, or a combination of the two....
Persistent link: https://www.econbiz.de/10011386442