Competition for imperfect consumers

John Vickers

International Journal of Industrial Organization, 2021, vol. 79, issue C

Abstract: This lecture provides a selective discussion of some issues in the economics of competition for imperfect consumers. Limited consumer awareness – about what deals are on offer, or about the consequences of purchasing decisions – is a central feature of many markets. Consumer imperfection can give rise to market power, but can also co-exist with strong rivalry between firms, and then is more for ‘consumer policy’ than competition policy. Two recent court cases illustrate some of the issues involved. The lecture then reviews a line of theoretical work on competition for imperfect consumers. The analysis highlights some policy tradeoffs, and a key theme is how patterns of consumer awareness matter for patterns of competition among firms.

Keywords: Price dispersion; Price discrimination; Consumer search; Consideration sets; Consumer policy (search for similar items in EconPapers)
JEL-codes: D11 D18 D43 D83 L13 L51 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:79:y:2021:i:c:s0167718721000321

DOI: 10.1016/j.ijindorg.2021.102739

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