Open Daily: 10am - 10pm | Alley door pickup 10am - 7pm 3038 Hennepin Ave Minneapolis, MN
612-822-4611

  • Open Daily: 10am - 10pm
    Alley-side Pickup: 10am - 7pm

    3038 Hennepin Ave Minneapolis, MN
    612-822-4611

Open Daily: 10am - 10pm | Alley-side Pickup: 10am - 7pm
3038 Hennepin Ave Minneapolis, MN
612-822-4611
Targeted Consumer Information and Prices The Private and Social Gains to Matching Consumers with Products

Targeted Consumer Information and Prices The Private and Social Gains to Matching Consumers with Products

Federal Trade Commission

Paperback

Business General

ISBN10: 1502355078
ISBN13: 9781502355072
Publisher: Createspace
Published: Sep 14 2014
Pages: 34
Weight: 0.23
Height: 0.07 Width: 8.50 Depth: 11.00
Language: English
It is well known that product differentiation increases both prices and profits, other things equal. What is less well understood is how the distribution of consumer preferences affects firms' incentives to differentiate their products. This book focuses on the incentive of firms to reveal truthful information about product attributes. Because consumers' preferences differ, the revelation of this information differentiates products. The profitability of inducing this differentiation is shown to be related to three aspects of the information; the size of the targeted group (i.e., the group who finds these attributes desirable), the magnitude of the perceived change in attributes induced by the information, and whether the information is symmetric. In particular, I show that the profits associated with information increase more than proportionately with the size of the targeted group. This implies that information will tend to be provided for large groups, even if there are no economies of scale in producing that information. The analysis also shows that in some circumstances, the revelation of asymmetric information can actually reduce the firm's profit.

Also in

Business General

View All