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. WebWe 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 cost. In a symmetric equilibrium, the price set by firms is continuously increasing in the cost of information for consumers and decreasing in the number of firms operating.
Inattentive consumers and product quality Request PDF
WebA 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 (1980) in which some consumers purchase from 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 … early boxers
Inattentive Consumers and Product Quality - Research Papers in …
WebA firm may “cheat” and offer a worthless product to exploit these inattentive consumers. In the unique symmetric equilibrium, firms follow a mixed strategy involving both price and quality dispersion. The presence of inattentive consumers harms attentive consumers, and enables firms to earn positive profits. Webthat is, controlling for movie quality, being #1 is associated with a $75 mil-lion increase in revenues, which is consistent with Proposition 1 . Testing Proposition 3. Proposition 3 states that, the greater the measure of inattentive consumers (parameter /), the greater the impact of being #1 through the awareness channel. WebJul 5, 2012 · Inattentive Consumers and Product Quality Mark Armstrong Yongmin Chen Abstract 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. early boxers names