The Effects of Incomplete Information on Consumer Choice PDF Download
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Author: Ran Kivetz
Publisher:
ISBN:
Category : Consumers' preferences
Languages : en
Pages : 57
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Book Description
Author: Ran Kivetz
Publisher:
ISBN:
Category : Consumers' preferences
Languages : en
Pages : 57
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Book Description
Author: Miloš Duško Graonic
Publisher:
ISBN:
Category :
Languages : en
Pages : 352
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Book Description
Author: James R. Bettman
Publisher: Addison Wesley Publishing Company
ISBN:
Category : Business & Economics
Languages : en
Pages : 424
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Book Description
Author: Victor P. Goldberg
Publisher:
ISBN:
Category : Consumer education
Languages : en
Pages : 58
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Book Description
Author: Andrew A. Mitchell
Publisher:
ISBN:
Category : Business & Economics
Languages : en
Pages : 136
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Book Description
Abstract: In order to understand how the market system provides information to buyers, the effect of information on consumer and market behavior is examined from the perspectives of economics, consumer psychology, and public policy. Economic analyses of information transmission and advertising are presented. Effects of different types of information on the behavior of firms, and information search strategies which consumers use to extract information from mass media advertisements are evaluated. Theories of information encoding and storage are described in terms of their implications for consumer research. The causes of information imperfections in local consumer markets (markets where different prices are charged for the same quality) are reviewed. Advertising regulation policy considerations are also examined. Consumer information systems for local services are discussed from the viewpoint of information needs and consumer patterns of information avoidance. (nm).
Author: W. Fred van Raaij
Publisher:
ISBN:
Category : Commercial products
Languages : en
Pages : 226
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Author: Frank Huettner
Publisher:
ISBN:
Category :
Languages : en
Pages : 52
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Book Description
Consumers often do not have complete information about the choices they face and therefore have to spend time and effort in acquiring information. Since information acquisition is costly, consumers trade-off the value of better information against its cost, and make their final product choices based on imperfect information. We model this decision using the rational inattention approach and describe the rationally inattentive consumer's choice behavior when she faces alternatives with different information costs. To this end, we introduce an information cost function that distinguishes between direct and implied information. We then analytically characterize the optimal choice probabilities. We find that non-uniform information costs can have a strong impact on product choice, which gets particularly conspicuous when the product alternatives are otherwise very similar. There are significant implications on how a seller should provide information about its products and how changes to the product set impacts consumer choice. For example, non-uniform information costs can lead to situations where it is disadvantageous for the seller to provide easier access to information for a particular product, and to situations where the addition of an inferior (never chosen) product increases the market share of another existing product (i.e., failure of regularity). We also provide an algorithm to compute the optimal choice probabilities and discuss how our framework can be empirically estimated from suitable choice data.
Author: Lawrence A. Crosby and James R. Taylor
Publisher:
ISBN:
Category :
Languages : en
Pages : 47
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Author: Frank Hüttner
Publisher:
ISBN:
Category :
Languages : de
Pages :
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Book Description
Consumers often do not have complete information about the choices they face and therefore have to spend time and effort in acquiring information. Since information acquisition is costly, consumers have to trade-off the value of better information against its cost, and make their final choices based on imperfect information. We model this decision using the rational inattention approach and describe the rationally inattentive consumer's choice behavior when she faces options with different information costs. To this end, we introduce an information cost function that distinguishes between direct and inferential information. We then analytically characterize the optimal behavior and derive the choice probabilities in closed-form. We find that non-uniform information costs can have a strong impact on product choice, which gets particularly conspicuous when the product alternatives are otherwise very similar. It can also lead to situations where it is disadvantageous for the seller to provide easier access to information for a particular product. Furthermore, it provides a new explanation for strong failure of regularity of consumer behaviour, which occurs if the addition of an inferior - never chosen - product to the choice set increases the market share of another existing product.
Author: Mary Lou Roberts
Publisher:
ISBN:
Category : Advertising
Languages : en
Pages : 406
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Book Description
