Competition, Persuasion, and Search

Teddy Mekonnen and Bobak Pakzad-Hurson

Papers from arXiv.org

Abstract: How does competition in markets for information affect the creation and division of surplus? We study this question in a search environment in which an agent searches sequentially for a high-quality good and learns about the quality of sampled goods by repeatedly purchasing signals from profit-maximizing information brokers. Brokers design and price signals but can commit only to spot contracts. We characterize the equilibrium payoff set as a function of the market structure -- the number of competing brokers. When search costs are low, market structure affects neither surplus generation nor its division. When costs are high, however, competition benefits the agent but reduces total surplus relative to monopoly. Methodologically, we extend repeated-games theory to stopping problems such as sequential search.

Date: 2024-11, Revised 2026-05
New Economics Papers: this item is included in nep-com, nep-gth, nep-mac and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://arxiv.org/pdf/2411.11183 Latest version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:2411.11183

Access Statistics for this paper

More papers in Papers from arXiv.org
Bibliographic data for series maintained by arXiv administrators ().