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Ordered Search and Equilibrium Obfuscation

  • Chris M. Wilson
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    This paper demonstrates the incentives for an oligopolist to obfuscate by deliberately increasing the cost with which consumers can locate its product and price.� Consumers are allowed to choose the optimal order in which to search firms and firms are able to influence this order through their choice of search costs and prices.� Competition does not ensure market transparency - for a large range of parameters, equilibrium search costs are positive and asymmetric across firms.� Intuitively, an obfuscating firm can soften the competition for consumers with low time costs by inducing the remaining consumers to optimally first search its rival.

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    File URL: http://www.economics.ox.ac.uk/materials/working_papers/paper401.pdf
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    Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 401.

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    Date of creation: 01 Aug 2008
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    Handle: RePEc:oxf:wpaper:401
    Contact details of provider: Postal: Manor Rd. Building, Oxford, OX1 3UQ
    Web page: http://www.economics.ox.ac.uk/Email:


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