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Low quality as a signal of high quality
Clements, Matthew T. - 2011
If a product has two dimensions of quality, one observable and one not, a firm can use observable quality as a signal of unobservable quality. The correlation between consumers' valuation of high quality in each dimension is a key determinant of the feasibility of such signaling. A firm may use...
Persistent link: https://www.econbiz.de/10008905517
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"Download for free" : when do providers of digital goods offer free samples?
Boom, Anette - 2004
to pure price signalling. Both, the monopolist and consumers benefit from the additional signal. …
Persistent link: https://www.econbiz.de/10010343967
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Price Signalling Differentiated Experience Goods : Are Uniform Movie Prices a Puzzle?
Park, In-Uck - 2020
price equilibrium and a price signalling equilibrium coexist. This is in contrast to the received wisdom that price … signalling of quality is nonviable in static settings. We also show that the seller's profit is always higher in the price … signalling equilibrium than in the uniform price equilibrium, but the consumer surplus and social welfare may be higher in either …
Persistent link: https://www.econbiz.de/10012829510
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Price Signaling and Channel Coordination
Wang, Ruitong - 2019
When information asymmetry exists in the market, firms often use the price signal to communicate unobservable quality to consumers. We examine the signaling role of retail price in a decentralized channel. Our normative model demonstrates that there might exist a moderate range of retail prices...
Persistent link: https://www.econbiz.de/10012890002
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Price Signaling and Channel Coordination
Wang, Ruitong - 2019
When information asymmetry exists in the market, firms often use the price signal to communicate unobservable quality to consumers. We examine the signaling role of retail price in a decentralized channel. Our normative model demonstrates that there might exist a moderate range of retail prices...
Persistent link: https://www.econbiz.de/10012890892
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Screening Inattentive Buyers
Mensch, Jeffrey - 2022
Information plays a crucial role in mechanism design problems. A potential complication is that buyers may be inattentive, and so their information may endogenously and flexibly depend on the offered mechanism. I show that it is without loss of generality to consider contour mechanisms, which...
Persistent link: https://www.econbiz.de/10013306514
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Low Quality as a Signal of High Quality
Clements, Matthew T. - 2011
If a product has two dimensions of quality, one observable and one not, a firm can use observable quality as a signal of unobservable quality. The correlation between consumers' valuation of high quality in each dimension is a key determinant of the feasibility of such signaling. A firm may use...
Persistent link: https://www.econbiz.de/10013210314
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Low Quality as a Signal of High Quality
Clements, Matthew T. - 2010
If a product has two dimensions of quality, one observable and one not, a firm can use observable quality as a signal of unobservable quality. The correlation between consumers' valuation of high quality in each dimension is a key determinant of the feasibility of such signaling. A firm may use...
Persistent link: https://www.econbiz.de/10013135066
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The Simple Analytics of Price Signaling Quality
Mirman, Leonard J. - 2012
We present a diagrammatic and step-by-step analysis of price signaling quality. Because quality is a continuum on the real positive line, out-of-equilibrium beliefs need not be specified, i.e., every positive price is a positive outcome in equilibrium. We first study the behavior of the monopoly...
Persistent link: https://www.econbiz.de/10013115026
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Optimal selling mechanisms under imperfect commitment
Beccuti, Juan I. - 2014
This paper studies the optimal mechanisms for a seller with imperfect commitment who puts up for sale one individual unit per period to a single buyer in a dynamic game. The buyer's willingness to pay remains constant over time and is his private information. In this setting, the seller cannot...
Persistent link: https://www.econbiz.de/10010402248