When does a firm disclose product information?

Abstract : A firm chooses a price and the product information it discloses to a consumer whose tastes are privately known. We provide a necessary and sufficient condition on the match function for full disclosure to be the unique equilibrium outcome whatever the costs and prior beliefs about product and consumer types. It allows for products with different qualities as well as some horizontal match heterogeneity. With independently distributed product and consumer types, full disclosure is always an equilibrium and a necessary and sufficient equilibrium condition is that all firm types earn at least the full-disclosure profit.
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Submitted on : Sunday, April 14, 2013 - 9:49:49 PM
Last modification on : Thursday, May 3, 2018 - 3:18:04 PM

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Frédéric Koessler, Régis Renault. When does a firm disclose product information?. The RAND Journal of Economics, 2012, 43 (4), pp.630-649. ⟨10.1111/1756-2171.12002⟩. ⟨hal-00813051⟩

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