WebCiteSeerX - Document Details (Isaac Councill, Lee Giles, Pradeep Teregowda): This paper studies a model in which some consumers shop on the basis of price alone, without … WebThis paper examines the role of consumer preferences, costs, and price competition in determining the competitive product strategy of a firm. In the model studied here, there are two identical firms competing on product quality and price. They face consumers who prefer a higher quality product to a lower quality product, but differ in how much ...
Endogenous product design and quality with rationally inattentive consumers
WebMay 1, 2012 · We study a market with rationally inattentive consumers who are unsure of the terms of the offers made by firms, but can acquire information about the terms at a … WebThe spillover amounts to an average drop of $2,057 in consumer valuations of these manufacturers’ vehicles and a 34.6% reduction in their annual sales. We substantiate our interpretation that the estimates reflect a reputation spillover using data on internet search behavior and direct measures of consumer sentiment from Twitter. how do cdns speed up web app resource access
Inattentive Consumers and Product Quality - CORE
WebThis paper presents a model in which some consumers shop on the basis of price alone, without attention to product quality. A firm may “cheat” (i.e., cut quality) to exploit these inattentive consumers. In the unique symmetric equilibrium, firms follow a mixed strategy involving both price and quality dispersion. WebDownloadable! This paper studies a model in which some consumers shop on the basis of price alone, without attention to potential differences in product quality. A firm may offer a low-quality product to exploit these inattentive consumers. In the unique symmetric equilibrium of the model, firms choose prices with mixed strategies, similarly to Varian … WebSep 17, 2024 · We find that consumers that can gather and process information at approximately no cost rationally select to be attentive while consumers that must incur a cost rationally select to be inattentive. how do cdfis make money