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Advertising Content

Listed author(s):
  • Simon P. Anderson

    ()

  • Régis Renault

    ()

Empirical evidence suggests that most advertisements contain little direct informa- tion. Many do not mention prices. We analyze a firm'ss choice of advertising content and the information disclosed to consumers. A firm advertises only product informa- tion, price information, or both; and prefers to convey only limited product information if possible. Extending the "persuasion" game, we show that quality information takes precedence over price information and horizontal product information.Though it may help to force the firm to disclose some product information, it is socially harmful to force it to provide full information if it has sufficient ability to parse the information imparted.

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File URL: http://www.virginia.edu/economics/RePEc/vir/virpap/papers/virpap362.pdf
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File URL: http://www.virginia.edu/economics/RePEc/vir/virpap/papers/virpap362f.pdf
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Paper provided by University of Virginia, Department of Economics in its series Virginia Economics Online Papers with number 362.

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Length: 35 pages
Date of creation: Dec 2002
Handle: RePEc:vir:virpap:362
Contact details of provider: Web page: http://www.virginia.edu/economics/home.html

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