search query: @author Mago, S.D. / total: 1
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| Author: | Cason, T.N. Mago, S.D. |
| Title: | Costly buyer search in laboratory markets with seller advertising |
| Journal: | Journal of Industrial Economics
2010 : JUN, VOL 58:2 p. 424-449 |
| Index terms: | advertising equilibrium analysis prices markets |
| Freeterms: | market power |
| Language: | eng |
| Abstract: | In this test, sellers choose prices and advertising strategies at the same time. Buyers either purchase at an advertised price or search for other prices. In the unique symmetric equilibrium, sellers charge a high price without advertising or advertise a price chosen from a lower interval. Increases in search or advertising costs raise equilibrium prices and impact equilibrium advertising intensity. The empirical results fit in with most comparative static predictions. Sellers, however, price much lower and advertise more aggressively than predicted. Hence, market outcomes more closely resemble a perfect information, Bertrand-like equilibrium than the imperfect information, mixed strategy equilibrium with substantial seller market power. |
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