Competing for Consumer Inattention
نویسندگان
چکیده
منابع مشابه
Competing for Consumer Inattention∗
Consumers purchase multiple types of goods, but may be able to examine only a limited number of markets for the best price. We propose a simple model which captures these features, conveying new insights. A firm’s price can deflect or draw attention to its market, and consequently, limited attention introduces a new dimension of cross-market competition. We characterize the equilibrium, and sho...
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To solve the firm’s problem in both attentive and inattentive cases I proceed in two steps. First, I fix a perceived utility U∗ to be offered and solve for the optimal price vector and allocation which implements U∗ subject to the no-free-lunch (NFL) constraint. The price vector and allocation determine expected surplus S and true expected-utility U . Hence the first step derives an optimal mar...
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For many goods and services, such as cellular-phone service and debit-card transactions, the price of the next unit of service depends on past usage. As a result, consumers who are inattentive to their past usage but are aware of contract terms may remain uncertain about the price of the next unit. I develop a model of inattentive consumption, derive equilibrium pricing when consumers are inatt...
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The competing mechanisms literature is extended to a market setting in which firms have fixed capacity, and there is a continuum of consumers who desire multiple units and can only purchase from one firm. Firms choose incentive compatible mechanisms in which consumers report their utility types; consumption of the good and payments of the numeraire are continuous functions of the reports. Unifo...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2013
ISSN: 1556-5068
DOI: 10.2139/ssrn.2291516