Hausken, Kjell - In: International Journal of Economics and Business Research 3 (2011) 4, pp. 407-442
An equilibrium model of advertising, production and exchange is developed. Sellers advertise and produce. In contrast … to models where one side is often kept to its reservation value, both sides of the exchange are made worse off due to … distortive advertising. Buyers read advertising, screen for quality of each good, choose prices optimally and provide a numeraire …