Dynamic Informative Advertising of New Experience Goods
| Autor: | Alexander E. Saak |
|---|---|
| Rok vydání: | 2012 |
| Předmět: |
Economics and Econometrics
education.field_of_study media_common.quotation_subject Population Informative advertising Experience good Advertising General Business Management and Accounting Accounting Business education Monopoly Welfare Private information retrieval media_common Valuation (finance) Agribusiness |
| Zdroj: | The Journal of Industrial Economics. 60:104-135 |
| ISSN: | 0022-1821 |
| DOI: | 10.1111/j.1467-6451.2012.00474.x |
| Popis: | This paper analyzes the optimal advertising and price policies of a monopolist who sells a new experience good over time to a population of heterogeneous forward-looking buyers. We consider advertising that can complement or substitute for learning-by-purchasing, and we show that the advertising intensity always peaks during the early stages when the price extracts surplus from the buyers who are yet to learn their valuation for the good. We also show that even though informative advertising may temporarily raise prices and slow down the learning process, an advertising ban can reduce welfare. |
| Databáze: | OpenAIRE |
| Externí odkaz: |
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