This chapter proposes an analysis of the role of advertising in the transmission of information in markets. It also describes how the economic analysis of informative advertising provides a satisfactory account of advertising practices and discusses the extent to which resorting to alternative...

Platforms often display their products ahead of third-party products in search. Is this due to consumers preferring platform-owned products or platforms engaging in self-preferencing by biasing search towards their own products? What are the welfare implications? I develop a structural model of...

How much do consumers’ privacy valuations change under the influence of choice architecture? How does this influence affect the efficiency of data collection, by changing not only the quantity of data collected but also its representativeness? To answer these questions, we run a large-scale...

Recent literature finds evidence that prices decrease during demand peaks. This paper argues that the price decrease is an artefact of ignoring product differentiation. We develop a simple individual demand model which shows that at periods of exogenous high demand, consumers migrate towards...

Online review aggregators (e.g., booking dot com or ClubKviar) provide detailed information about experience goods, such as restaurants and hotels. This study fosters the understanding of how such aggregators modify competition, profits and welfare. Using a spokes model of horizontal...

In this paper we develop an analytical model that characterizes the structure of price dispersion observed in electronic markets. Findings of our model are consistent with empirical evidence in these e-markets. We show that when different types of buyers' have different search costs, firms...

I study the impact of consumer reviews on the incentives for firms to participate in the market. Firms produce goods of heterogeneous, unknown quality that is gradually revealed via consumer reviews, and face both entry and exit decisions. A platform combines past reviews to construct...

Policymakers and market intermediaries often use quality scores to alleviate asymmetric information about product quality. Scores affect the demand for quality and, in equilibrium, its supply. Equilibrium effects break the rule whereby more information is always better, and the optimal design of...

This paper studies a “market creating” firm that offers a matching environment, by charging an access fee, to a population of users who wish to form a match. We focus on an environment where users only observe a signal from their randomly assigned partner's type and the signal...

We study the design of online platforms that aggregate information and facilitate transactions. Two different designs can be observed in the market: revealing platforms that disclose the identity of transaction partners (e.g. Booking) and anonymous platforms that do not (e.g. Hotwire). To...