Prominence and Consumer Search.
This article examines the implications of "prominence" in search markets. We model prominence by supposing that the prominent firm will be sampled first by all consumers. If there are no systematic quality differences among firms, we find that the prominent firm will charge a lower price t...
| Главные авторы: | , , |
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| Формат: | Journal article |
| Язык: | English |
| Опубликовано: |
Blackwell Publishing
2009
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| _version_ | 1826264445619273728 |
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| author | Armstrong, M Vickers, J Zhou, J |
| author_facet | Armstrong, M Vickers, J Zhou, J |
| author_sort | Armstrong, M |
| collection | OXFORD |
| description | This article examines the implications of "prominence" in search markets. We model prominence by supposing that the prominent firm will be sampled first by all consumers. If there are no systematic quality differences among firms, we find that the prominent firm will charge a lower price than its less prominent rivals. Making a firm prominent will typically lead to higher industry profit but lower consumer surplus and welfare. The model is extended by introducing heterogeneous product qualities, in which case the firm with the highest-quality product has the greatest incentive to become prominent, and making it prominent will boost industry profit, consumer surplus, and welfare. |
| first_indexed | 2024-03-06T20:07:55Z |
| format | Journal article |
| id | oxford-uuid:29889df4-ecdc-4670-8a81-ab82233e4b00 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-06T20:07:55Z |
| publishDate | 2009 |
| publisher | Blackwell Publishing |
| record_format | dspace |
| spelling | oxford-uuid:29889df4-ecdc-4670-8a81-ab82233e4b002022-03-26T12:19:44ZProminence and Consumer Search.Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:29889df4-ecdc-4670-8a81-ab82233e4b00EnglishDepartment of Economics - ePrintsBlackwell Publishing2009Armstrong, MVickers, JZhou, JThis article examines the implications of "prominence" in search markets. We model prominence by supposing that the prominent firm will be sampled first by all consumers. If there are no systematic quality differences among firms, we find that the prominent firm will charge a lower price than its less prominent rivals. Making a firm prominent will typically lead to higher industry profit but lower consumer surplus and welfare. The model is extended by introducing heterogeneous product qualities, in which case the firm with the highest-quality product has the greatest incentive to become prominent, and making it prominent will boost industry profit, consumer surplus, and welfare. |
| spellingShingle | Armstrong, M Vickers, J Zhou, J Prominence and Consumer Search. |
| title | Prominence and Consumer Search. |
| title_full | Prominence and Consumer Search. |
| title_fullStr | Prominence and Consumer Search. |
| title_full_unstemmed | Prominence and Consumer Search. |
| title_short | Prominence and Consumer Search. |
| title_sort | prominence and consumer search |
| work_keys_str_mv | AT armstrongm prominenceandconsumersearch AT vickersj prominenceandconsumersearch AT zhouj prominenceandconsumersearch |