Dynamic informative advertising of new experience goods
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 int...
| Main Author: | |
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| Format: | Journal Article |
| Language: | Inglés |
| Published: |
Wiley
2012
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| Online Access: | https://hdl.handle.net/10568/153071 |
| _version_ | 1855538912986923008 |
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| author | Saak, Alexander E. |
| author_browse | Saak, Alexander E. |
| author_facet | Saak, Alexander E. |
| author_sort | Saak, Alexander E. |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | 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. |
| format | Journal Article |
| id | CGSpace153071 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2012 |
| publishDateRange | 2012 |
| publishDateSort | 2012 |
| publisher | Wiley |
| publisherStr | Wiley |
| record_format | dspace |
| spelling | CGSpace1530712024-11-15T08:53:03Z Dynamic informative advertising of new experience goods Saak, Alexander E. advertising experience goods learning monopolies information 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. 2012-03 2024-10-01T13:55:35Z 2024-10-01T13:55:35Z Journal Article https://hdl.handle.net/10568/153071 en Limited Access Wiley Saak, Alexander E. 2012. Dynamic informative advertising of new experience goods. The Journal of Industrial Economics 60(1): 104–135 |
| spellingShingle | advertising experience goods learning monopolies information Saak, Alexander E. Dynamic informative advertising of new experience goods |
| title | Dynamic informative advertising of new experience goods |
| title_full | Dynamic informative advertising of new experience goods |
| title_fullStr | Dynamic informative advertising of new experience goods |
| title_full_unstemmed | Dynamic informative advertising of new experience goods |
| title_short | Dynamic informative advertising of new experience goods |
| title_sort | dynamic informative advertising of new experience goods |
| topic | advertising experience goods learning monopolies information |
| url | https://hdl.handle.net/10568/153071 |
| work_keys_str_mv | AT saakalexandere dynamicinformativeadvertisingofnewexperiencegoods |