IDEAS home Printed from https://ideas.repec.org/p/qmw/qmwecw/743.html
   My bibliography  Save this paper

Competing for Attention: Is the Showiest Also the Best?

Author

Listed:
  • Paola Manzini

    (University of St. Andrews, and IZA)

  • Marco Mariotti

    (Queen Mary University of London)

Abstract

There are many situations in which alternatives ranked by quality wish to be chosen and compete for the imperfect attention of a chooser by selecting their own salience. The chooser may be "tricked" into choosing more salient but inferior alternatives. We investigate when competitive forces ensure instead that "the showiest is the best", that is, when the best alternative is maximally salient (and the one that gets picked most often) in equilibrium. We prove that the structure of externalities in the technology of salience is key. Broadly speaking, positive externalities favour correlation between quality and salience.

Suggested Citation

  • Paola Manzini & Marco Mariotti, 2015. "Competing for Attention: Is the Showiest Also the Best?," Working Papers 743, Queen Mary University of London, School of Economics and Finance.
    • Handle: RePEc:qmw:qmwecw:743
    as

    Download full text from publisher

    File URL: https://www.qmul.ac.uk/sef/media/econ/research/workingpapers/2015/items/wp743.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Paola Manzini & Marco Mariotti, 2014. "Stochastic Choice and Consideration Sets," Econometrica, Econometric Society, vol. 82(3), pages 1153-1176, May.
    2. Geoffroy de Clippel & Kfir Eliaz & Kareen Rozen, 2014. "Competing for Consumer Inattention," Journal of Political Economy, University of Chicago Press, vol. 122(6), pages 1203-1234.
    3. Babin, Barry J & Darden, William R & Griffin, Mitch, 1994. "Work and/or Fun: Measuring Hedonic and Utilitarian Shopping Value," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 20(4), pages 644-656, March.
    4. Kfir Eliaz & Ran Spiegler, 2011. "Consideration Sets and Competitive Marketing," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 78(1), pages 235-262.
    5. Elena Reutskaja & Rosemarie Nagel & Colin F. Camerer & Antonio Rangel, 2011. "Search Dynamics in Consumer Choice under Time Pressure: An Eye-Tracking Study," American Economic Review, American Economic Association, vol. 101(2), pages 900-926, April.
    6. Michelle Sovinsky Goeree, 2008. "Limited Information and Advertising in the U.S. Personal Computer Industry," Econometrica, Econometric Society, vol. 76(5), pages 1017-1074, September.
    7. , & ,, 2011. "On the strategic use of attention grabbers," Theoretical Economics, Econometric Society, vol. 6(1), January.
    8. Paola Manzini & Marco Mariotti, 2014. "Stochastic Choice and Consideration Sets," Econometrica, Econometric Society, vol. 82(3), pages 1153-1176, May.
    9. Gerard R. Butters, 1977. "Equilibrium Distributions of Sales and Advertising Prices," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 465-491.
    10. Bagwell, Kyle, 2007. "The Economic Analysis of Advertising," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 28, pages 1701-1844, Elsevier.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Schlatterer, Markus & Saur, Marc & Schmitt, Stefanie, 2019. "Horizontal product differentiation with limited attentive consumers," VfS Annual Conference 2019 (Leipzig): 30 Years after the Fall of the Berlin Wall - Democracy and Market Economy 203571, Verein für Socialpolitik / German Economic Association.
    2. Schmitt, Stefanie Y., 2022. "Competition with limited attention to quality differences," BERG Working Paper Series 184, Bamberg University, Bamberg Economic Research Group.
    3. Saur, Marc P. & Schlatterer, Markus G. & Schmitt, Stefanie Y., 2022. "Limited perception and price discrimination in a model of horizontal product differentiation," Games and Economic Behavior, Elsevier, vol. 134(C), pages 151-168.
    4. Saur, Marc P. & Schlatterer, Markus G. & Schmitt, Stefanie Yvonne, 2019. "Horizontal product differentiation with limited attentive consumers," BERG Working Paper Series 143, Bamberg University, Bamberg Economic Research Group.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paola Manzini & Marco Mariotti, 2018. "Competing for Attention: Is the Showiest Also the Best?," Economic Journal, Royal Economic Society, vol. 128(609), pages 827-844, March.
    2. Paola Manzini & Marco Mariotti, 2018. "Competing for Attention: Is the Showiest Also the Best?," Economic Journal, Royal Economic Society, vol. 128(609), pages 827-844, March.
    3. Saur, Marc P. & Schlatterer, Markus G. & Schmitt, Stefanie Y., 2022. "Limited perception and price discrimination in a model of horizontal product differentiation," Games and Economic Behavior, Elsevier, vol. 134(C), pages 151-168.
    4. Mark Armstrong & John Vickers, 2022. "Patterns of Competitive Interaction," Econometrica, Econometric Society, vol. 90(1), pages 153-191, January.
    5. Manzini, Paola & Mariotti, Marco, 2013. "Imperfect Attention and Menu Evaluations," SIRE Discussion Papers 2013-98, Scottish Institute for Research in Economics (SIRE).
    6. Paola Manzini & Marco Mariotti, 2015. "Modelling Imperfect Attention," Working Papers 744, Queen Mary University of London, School of Economics and Finance.
    7. Paola Manzini & Marco Mariotti, 2015. "Modelling Imperfect Attention," Working Papers 744, Queen Mary University of London, School of Economics and Finance.
    8. Papi, Mauro, 2018. "Price competition with satisficing consumers," International Journal of Industrial Organization, Elsevier, vol. 58(C), pages 252-272.
    9. Hefti, Andreas, 2018. "Limited attention, competition and welfare," Journal of Economic Theory, Elsevier, vol. 178(C), pages 318-359.
    10. Karagözoğlu, Emin & Keskin, Kerim, 2024. "Consideration sets and reference points in a dynamic bargaining game," Journal of Economic Behavior & Organization, Elsevier, vol. 219(C), pages 381-403.
    11. Mark Armstrong & John Vickers, 2018. "Patterns of Competition with Captive Customers," Economics Series Working Papers 864, University of Oxford, Department of Economics.
    12. Valentino Dardanoni & Paola Manzini & Marco Mariotti & Christopher J. Tyson, 2020. "Inferring Cognitive Heterogeneity From Aggregate Choices," Econometrica, Econometric Society, vol. 88(3), pages 1269-1296, May.
    13. Michael Grubb, 2015. "Failing to Choose the Best Price: Theory, Evidence, and Policy," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 47(3), pages 303-340, November.
    14. Crawford, Gregory S. & Griffith, Rachel & Iaria, Alessandro, 2021. "A survey of preference estimation with unobserved choice set heterogeneity," Journal of Econometrics, Elsevier, vol. 222(1), pages 4-43.
    15. Aguiar, Victor H. & Boccardi, Maria Jose & Dean, Mark, 2016. "Satisficing and stochastic choice," Journal of Economic Theory, Elsevier, vol. 166(C), pages 445-482.
    16. Chen He & Tobias J. Klein, 2023. "Advertising as a Reminder: Evidence from the Dutch State Lottery," Marketing Science, INFORMS, vol. 42(5), pages 892-909, September.
    17. Helmers, Christian & Krishnan, Pramila & Patnam, Manasa, 2019. "Attention and saliency on the internet: Evidence from an online recommendation system," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 216-242.
    18. Carlo Baldassi & Simone Cerreia-Vioglio & Fabio Maccheroni & Massimo Marinacci & Marco Pirazzini, 2020. "A Behavioral Characterization of the Drift Diffusion Model and Its Multialternative Extension for Choice Under Time Pressure," Management Science, INFORMS, vol. 66(11), pages 5075-5093, November.
    19. Dokyun Lee & Kartik Hosanagar, 2021. "How Do Product Attributes and Reviews Moderate the Impact of Recommender Systems Through Purchase Stages?," Management Science, INFORMS, vol. 67(1), pages 524-546, January.
    20. Manzini, Paola & Mariotti, Marco, 2013. "Imperfect Attention and Menu Evaluations," SIRE Discussion Papers 2013-98, Scottish Institute for Research in Economics (SIRE).

    More about this item

    Keywords

    Consideration sets; Bounded rationality; Stochastic choice;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:qmw:qmwecw:743. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Nicholas Owen (email available below). General contact details of provider: https://edirc.repec.org/data/deqmwuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.