search query: @author Bagwell, K. / total: 19
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| Author: | Bagwell, K. Ramey, G. |
| Title: | Advertising and coordination |
| Journal: | Review of Economic Studies
1994 : JAN, VOL. 61(1):206, p. 153-171 |
| Index terms: | ADVERTISING PRICING DUOPOLY |
| Language: | eng |
| Abstract: | When market information such as price is difficult to communicate, consumers and firms may be unable to take advantage of mutually beneficial scale economies, so that coordination failures arise. Ostensibly informative advertising expenditures can be used to eliminate coordination failures, by allowing an efficient firm to communicate implicitly that it offers a low price. This provides a theoretical explanation for Benham's (1972) empirical association of the ability to advertise with lower prices and larger scale. |
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