Journal ArticleDOI
Ordered Consumer Search
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In this article, the authors discuss situations in which consumers search through their options in a deliberate order, in contrast to more familiar models with random search, and show how ordered search can be reformulated as a simpler discrete choice problem without search frictions.Abstract:
The paper discusses situations in which consumers search through their options in a deliberate order, in contrast to more familiar models with random search. Topics include: network effects (consumers may be better off following the same search order as other consumers); the use of price and non-price advertising to direct search; the impact of consumers starting a new search with their previous supplier; the incentive sellers have to merge or co-locate with other sellers; and the incentive a seller can have to raise its own search cost. I also show how ordered search can be reformulated as a simpler discrete choice problem without search frictions.read more
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Journal ArticleDOI
Targeted Advertising and Consumer Inference
Jiwoong Shin,Jungju Yu,Jungju Yu +2 more
TL;DR: It is found that the increase in consumer search creates an advertising spillover beyond the level of the mere awareness effects of advertising and that firms' equilibrium level of targeted advertising can be non-monotonic in targeting accuracy.
OtherDOI
Firm pricing with consumer search
Simon P. Anderson,Régis Renault +1 more
TL;DR: In this paper, the authors present the basic concepts underpinning the theory of imperfectly competitive markets with consumer search, and stress that appropriate theoretical frameworks should involve sufficient heterogeneity among agents on both sides of the market.
Posted Content
Consumer Search with Observational Learning
Sandro Shelegia,Daniel Garcia +1 more
TL;DR: In this article, the authors show that if consumers emulate their predecessor and initiate their search at the retailer they purchased from, a social multiplier of demand induces a lower equilibrium price, and as the search cost increases, rms compete ercely to attract consumers and prices converge to the marginal cost.
Posted Content
Consumer Search Costs and Preferences on the Internet
TL;DR: In this article, the authors analyze consumers' search and purchase decisions on an Internet platform and derive and estimate a structural model of sequential directed search where consumers observe all advert prices but have to pay a search cost to see the other advert characteristics.
Journal ArticleDOI
Browsing versus Studying: A Pro-market Case for Regulation
TL;DR: In this paper, the authors identify a competition-policy-based argument for regulating the secondary features of complex or complexly priced products when consumers have limited attention and show that for a procompetitive effect to obtain, the regulation must apply to the secondary feature, and not to the total price or value of the product.
References
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Journal ArticleDOI
A Simple Model of Herd Behavior
TL;DR: In this article, the authors analyze a sequential decision model in which each decision maker looks at the decisions made by previous decision makers in taking her own decision, and they show that the decision rules that are chosen by optimizing individuals will be characterized by herd behavior.
Journal ArticleDOI
Information and Consumer Behavior
TL;DR: In this article, the authors argue that consumers lack full information about the prices of goods, but their information is probably poorer about the quality variation of products simply because the latter information is more difficult to obtain.
Posted Content
A Theory of Fads, Fashion, Custom, and Cultural Change as Informational Cascades
TL;DR: It is argued that localized conformity of behavior and the fragility of mass behaviors can be explained by informational cascades.