Pastine, Ivan and Pastine, Tuvana
(2011)
Coordination in Markets with Consumption Externalities: The Role of Advertising and Product Quality.
The Manchester School, 79 (1).
pp. 45-62.
Abstract
In this paper we study advertising in markets with positive consumption
externalities. In such markets, we show that firms may engage in adver-
tising competition to coordinate consumer expectations on their own
brand as long as they produce goods of similar quality. The firm with the
lower-quality product has a greater incentive to advertise. Hence in equi-
librium, the lower-quality product will often be more popular
| Item Type: |
Article
|
| Keywords: |
Markets; Consumption Externalities; Advertising; Product Quality; |
| Academic Unit: |
Faculty of Social Sciences > Economics, Finance and Accounting |
| Item ID: |
5014 |
| Identification Number: |
0.1111/j.1467-9957.2010.02186.x |
| Depositing User: |
Tuvana Pastine
|
| Date Deposited: |
11 Jun 2014 13:40 |
| Journal or Publication Title: |
The Manchester School |
| Publisher: |
Blackwell Publishing Ltd |
| Refereed: |
Yes |
| URI: |
|
| Use Licence: |
This item is available under a Creative Commons Attribution Non Commercial Share Alike Licence (CC BY-NC-SA). Details of this licence are available
here |
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