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SMU SOE Online Seminar (Oct 21, 2021, 4.00pm-5.30pm): Attraction Versus Persuasion
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TOPIC:
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ATTRACTION VERSUS PERSUASION
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ABSTRACT
We consider a model of oligopolistic competition in a market with search frictions, in which competing firms with products of unknown quality advertise how much information a consumer's visit will glean. We characterize the unique symmetric equilibrium of this game, which, due to the countervailing incentives of attraction and persuasion, generates a payoff function for each firm that is linear in the firm's realized effective value. If the expected quality of the products is sufficiently high (or competition is sufficiently fierce), this corresponds to full information-search frictions beget the first-best level of information provision. If not, this corresponds to information dispersion-firms randomize over signals. If the attraction incentive is absent (due to hidden information or costless search), firms reveal less information and information dispersion does not arise.
Click here to view the CV.
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This seminar will be held virtually via Zoom. A confirmation email with the Zoom details will be sent to the registered email by 20 October 2021.
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PRESENTER
Pak Hung Au
The Hong Kong University of
Science and Technology
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RESEARCH FIELDS
Information Economics
Contract Theory
Industrial Organization
Behavioral Economics
Experimental Economics
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DATE:
21 October 2021 (Thursday)
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TIME:
4.00pm - 5.30pm
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