Ordered search with asymmetric product design

Hui Song ()
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Hui Song: Shandong University

Journal of Economics, 2017, vol. 121, issue 2, No 1, 105-132

Abstract: Abstract Two firms sell horizontally differentiated products on a platform; one product has generic design, whereas the other has polarized design. Consumers search sequentially for products and prices. We show that there always exists an equilibrium where firms correctly expect consumers to first search the product with polarized design. If the platform is able to choose a search order for consumers, generally it lets consumers search the product with polarized design first. The polarized–generic ordering can be achieved using a generalized English auction when product designs cannot be observed by the platform.

Keywords: Ordered search; Product differentiation; Taste heterogeneity (search for similar items in EconPapers)
JEL-codes: D43 D83 L13 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:kap:jeczfn:v:121:y:2017:i:2:d:10.1007_s00712-016-0518-0

DOI: 10.1007/s00712-016-0518-0

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