search query: @author Bester, H. / total: 8
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| Author: | Bester, H. |
| Title: | Random advertising and monopolistic price dispersion |
| Journal: | Journal of Economics & Management Strategy
1994 : FALL, VOL. 3:3, p. 545-559 |
| Index terms: | ADVERTISING PRICES CONSUMERS |
| Language: | eng |
| Abstract: | The author investigates the role of price advertising in a market where consumers are imperfectly informed about prices. The author considers a monopolist whose demand depends on price and advertising expenditure. This demand function is derived from optimizing behavior of consumers. Uninformed consumers may pay a cost to visit the seller and obtain price information. Advertising enables the monopolist to increase the number of informed consumers. In equilibrium the uninformed consumers form rational price expectations, and the seller necessarily adopts a random pricing and advertising strategy. |
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