Non-comparative versus Comparative Advertising of Quality

Winand Emons and Claude Fluet

CIRANO Working Papers from CIRANO

Abstract: Two firms produce a good with a horizontal and a vertical characteristic called quality. The difference in the unobservable quality levels determines how the firms share the market. We consider two scenarios: In the first one, firms disclose quality; in the second one, they send costly signals thereof. Under non-comparative advertising a firm advertises its own quality, under comparative advertising a firm advertises the quality differential. In either scenario, under comparative advertising the firms never advertise together which they may do under non-comparative advertising. Moreover, under comparative advertising firms do not advertise when the informational value to consumers is small.

Keywords: quality; advertising; disclosure; signalling (search for similar items in EconPapers)
JEL-codes: D82 L15 M37 (search for similar items in EconPapers)
Date: 2011-12-01
New Economics Papers: this item is included in nep-com and nep-mkt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://cirano.qc.ca/files/publications/2011s-75.pdf

Related works:
Journal Article: Non-comparative versus comparative advertising of quality (2012)
Working Paper: Non-Comparative versus Comparative Advertising of Quality (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:cir:cirwor:2011s-75

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