Phillip J. Nelson

Bio: Phillip J. Nelson is an academic researcher from Binghamton University. The author has contributed to research in topics: Quality (business) & Voting. The author has an hindex of 7, co-authored 11 publications receiving 8363 citations.

Information and Consumer Behavior

Abstract: Consumers are continually making choices among products, the consequences of which they are but dimly aware. Not only do consumers lack full information about the prices of goods, but their information is probably even poorer about the quality variation of products simply because the latter information is more difficult to obtain. One can, for example, readily determine the price of a television set; it is more difficult to determine its performance characteristics under various conditions or its expected need for repairs. This article contends that limitations of consumer information about quality have profound effects upon the market structure of consumer goods. In particular, monopoly power for a consumer good will be greater if consumers know about the quality of only a few brands of that good. This is a significant departure from the literature. Economists have long been interested in the determinants of monopoly power, but studies have always concentrated on the production function or market-size variables. I try to show that consumer behavior is also relevant to the determination of monopoly power in consumer industries. Location theory has also ignored the consumer's lack of information. Since many trips to a store are, in part, quests for information, the location of retail stores can be profoundly affected by consumer efforts to acquire information. I shall also try to show that advertising and inventory policy are affected by consumer ignorance about quality differences among brands. All of these impacts of consumer ignorance have remained unexplored because economists have not developed a systematic analysis of consumer quests for information about quality differences. Information about quality differs from information about price because the former is usually more expensive to buy than the latter. Indeed this is one reason we expect the variance in the utility of quality facing a consumer to be greater than the variance in the utility of price. This difference in the price of information can lead to fundamentally

Advertising as Information

Abstract: This paper tries to show how the major features of the behavior of advertising can be explained by advertising's information function. For search qualities advertising provides direct information about the characteristics of a brand. For experience qualities the most important information conveyed by advertising is simply that the brand advertises. This contrast in advertising by these qualities leads to significant differences in its behavior. How does advertising provide information to the consumer? The producer in his advertising is not interested directly in providing information for consumers. He is interested in selling more of his product. Subject to a few constraints, the advertising message says anything the seller of a brand wishes. A mechanism is required to make the selling job of advertising generate information to the consumer. [Авторский текст]

Consumer Information and Advertising

Abstract: Economists have long believed that product differentiation is an important determinant of market behavior (eg, Chamberlin, 1950; Bain, 1956), but economists have not been very successful in giving this concept operational meaning1 One reason for this lack of success is that economists have not focused on one of the key elements of product differentiation: the consumer’s acquisition of information about product quality I show in this paper that product differentiation will have quite different consequences on market behavior given different ways in which consumers obtain their information These theoretical results are then supported by substantial empirical evidence

If Extremists Vote How do They Express Themselves? An Empirical Test of an Expressive Theory of Voting

Abstract: The expressive theory of voting needs more specification of the motives for expression if it is not merely to be a theory of non-instrumental voting. Brennan and Hamlin provide such a specification. Unfortunately, using individual U.S. data from the General Social Surveys we find their predictions are contradicted. Nor if other evidence in the literature purported to be evidence of expressive voting actually implied by it. We believe that this is because the reason people express themselves in voting is to signal others.

Signaling Goodness: Social Rules and Public Choice

Abstract: Political, intellectual, and academic discourse in the United States has been awash in political correctness, which has itself been berated and defended -- yet little understood. As a corrective, Nelson and Greene look at a more general process: adopting political positions to enhance one's reputation for trustworthiness both to others and to oneself. Phillip Nelson and Kenneth Greene are Professors of Economics in the Department of Economics at the State University of New York, Binghamton.

A Conceptual Model of Service Quality and Its Implications for Future Research

Abstract: The attainment of quality in products and services has become a pivotal concern of the 1980s. While quality in tangible goods has been described and measured by marketers, quality in services is la...

Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence:

Abstract: Evidence from past research and insights from an exploratory investigation are combined in a conceptual model that defines and relates price, perceived quality, and perceived value. Propositions ab...

Corporate Social Responsibility: a Theory of the Firm Perspective

Abstract: We outline a supply and demand model of corporate social responsibility (CSR). Based on this framework, we hypothesize that a firm's level of CSR will depend on its size, level of diversification, research and development, advertising, government sales, consumer income, labor market conditions, and stage in the industry life cycle. From these hypotheses, we conclude that there is an “ideal” level of CSR, which managers can determine via cost-benefit analysis, and that there is a neutral relationship between CSR and financial performance.

Customer satisfaction, market share, and profitability: Findings from Sweden.

Abstract: Are there economic benefits to improving customer satisfaction? Many firms that are frustrated in their efforts to improve quality and customer satisfaction are beginning to question the link betwe...

Information Rules: A Strategic Guide to the Network Economy

Abstract: From the Publisher: Information Goods -- from movies and music to software code and stock quotes - have supplanted industrial goods as the key drivers of world markets. Confronted by this New Economy, many instinctively react by searching for a corresponding New Economics to guide their business decisions. Executives charged with rolling out cutting-edge software products or on-line versions of their magazines are tempted to abandon the classic lessons of economics, and rely instead on an ever changing roster of trends, buzzwords, and analogies that promise to guide strategy in the information age. Not so fast, say authors Carl Shapiro and Hal R. Varian. In Information Rules they warn managers, "Ignore basic economic principles at your own risk. Technology changes. Economic laws do not." Understanding these laws and their relevance to information goods is critical when fashioning today's successful competitive strategies. Information Rules introduces and explains the economic concepts needed to navigate the evolving network economy. Information Rules will help business leaders and policy makers - from executives in the entertainment, publishing, hardware, and software industries to lawyers, finance professionals, and writers -- make intelligent decisions about their information assets.