Information Aggregation Under Strategic Delay
In this paper, we show that consumers delay their buying to learn the unknown quality of a product. Agents receive imperfect but informative signals about the unknown quality. Then, each one simultaneously decides whether or not to buy the product in one of the two periods. Consumers with moderate tastes will strategically delay their buying to the second period even though they receive a good signal. They deduce the true quality by observing the mass of first period buyers. We avoid equilibrium non-existence problem by using agents with different private values.
Volume (Year): 12 (2008)
Issue (Month): 23 ()
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- Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, March.
- Caplin, A. & Leahy, J., 1992.
"Business as Usual, Market Crashes, and Wisdom after the Fact,"
Harvard Institute of Economic Research Working Papers
1594, Harvard - Institute of Economic Research.
- Caplin, Andrew & Leahy, John, 1994. "Business as Usual, Market Crashes, and Wisdom after the Fact," American Economic Review, American Economic Association, vol. 84(3), pages 548-65, June.
- Nancy L. Stokey, 1979. "Intertemporal Price Discrimination," The Quarterly Journal of Economics, Oxford University Press, vol. 93(3), pages 355-371.
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