With a little help from my enemy: comparative advertising as a signal of quality
AbstractWe extend the theory of advertising as a quality signal, using a model where an entrant can choose to advertise by comparing its product to that of an established incumbent. Comparative advertising, comparing quality of one’s own product to that of a rival’s, empowers the latter to file for court intervention if it believes the comparison to be false or misleading. We show that comparative advertising can be a signal in instances where generic advertising is not viable.
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Bibliographic InfoPaper provided by Department of Economics, Management and Quantitative Methods at Università degli Studi di Milano in its series Departmental Working Papers with number 2008-31.
Date of creation: 16 Oct 2008
Date of revision:
Advertising; Quality; signaling; Entry; Competition;
Other versions of this item:
- Francesca Barigozzi & Paolo G. Garella & Martin Peitz, 2009. "With a Little Help from My Enemy: Comparative Advertising as a Signal of Quality," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 18(4), pages 1071-1094, December.
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- M37 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Advertising
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-06-17 (All new papers)
- NEP-COM-2009-06-17 (Industrial Competition)
- NEP-CTA-2009-06-17 (Contract Theory & Applications)
- NEP-MIC-2009-06-17 (Microeconomics)
- NEP-MKT-2009-06-17 (Marketing)
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- Giri, B.C. & Sharma, S., 2014. "Manufacturer's pricing strategy in a two-level supply chain with competing retailers and advertising cost dependent demand," Economic Modelling, Elsevier, vol. 38(C), pages 102-111.
- Viscolani, Bruno, 2012. "Pure-strategy Nash equilibria in an advertising game with interference," European Journal of Operational Research, Elsevier, vol. 216(3), pages 605-612.
- Winand Emons & Claude Fluet, 2011.
"Non-Comparative versus Comparative Advertising of Quality,"
Cahiers de recherche
- Emons, Winand & Fluet, Claude, 2012. "Non-comparative versus comparative advertising of quality," International Journal of Industrial Organization, Elsevier, vol. 30(4), pages 352-360.
- Winand Emons & Claude Fluet, 2011. "Non-comparative versus Comparative Advertising of Quality," CIRANO Working Papers 2011s-75, CIRANO.
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