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We propose a model for word of mouth (WoM) management where a firm has two tools at hand: referral rewards and offering a free contract. Current customers' incentives to engage in WoM can affect the contracting problem of a firm in the presence of positive externalities of users. Formally, we...
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We incorporate word of mouth (WoM) in a classic Maskin-Riley contracting problem, allowing for referral rewards to senders of WoM. Current customers' incentives to engage in WoM can affect the contracting problem of a firm in the presence of positive externalities of users. We fully characterize...
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We incorporate word of mouth (WoM) in a classic Maskin-Riley contracting problem, allowing for referral rewards to senders of WoM. Current customers' incentives to engage in WoM can affect the contracting problem of a firm in the presence of positive externalities of users. We fully characterize...
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