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Search Disclosure

Author

Listed:
  • Carl-Christian Groh
  • Marcel Preuss

Abstract

We study information sharing between competing sellers in markets where consumers sample sellers sequentially. Sellers can disclose to their rival when they encounter a buyer. Providing this information, which we call search disclosure, can enable all forms of search history-based price discrimination. Yet, firms only conduct search disclosure in equilibrium if search costs are low or price revisions are infeasible. The kind of search disclosure that can emerge in equilibrium leads to price discrimination that reduces consumer surplus and total welfare. However, if firms were mandated to use search disclosure at all times, consumer surplus would be higher.

Suggested Citation

  • Carl-Christian Groh & Marcel Preuss, 2022. "Search Disclosure," CRC TR 224 Discussion Paper Series crctr224_2022_384, University of Bonn and University of Mannheim, Germany.
  • Handle: RePEc:bon:boncrc:crctr224_2022_384
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    File URL: https://www.crctr224.de/research/discussion-papers/archive/dp384
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    More about this item

    Keywords

    Search; Information Exchange; Antitrust; Price Discrimination;
    All these keywords.

    JEL classification:

    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software

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