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Risk Attitudes and Internet Search Engines: Theory and Experimental Evidence

Aurora García-Gallego (), Nikolaos Georgantzís (), Pedro Pereira and José C. Pernías-Cerrillo ()
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José C. Pernías-Cerrillo: Universitat Jaume I (Castellón, Spain)

No 04-03, Working Papers from NET Institute

Abstract: This paper analyzes the impact on consumer prices of the size and biases of price comparison search engines. We develop several theoretical predictions, in the context of a model related to Burdett and Judd (1983) and Varian (1980), and test them experimentally. The data supports the model’s predictions regarding the impact of the number of firms, and the type of bias of the search engine. The data does not support the model’s predictions regarding the impact of the size of the search engine. We identified several data patterns, and developed an econometric model for the price distributions. Variables accounting for risk attitudes improved significantly the explanatory power of the econometric model.

Keywords: Search engines; incomplete information; biased information; price levels; experiments (search for similar items in EconPapers)
JEL-codes: D43 D83 L13 (search for similar items in EconPapers)
Pages: 56 pages
Date: 2004-10, Revised 2004-10
New Economics Papers: this item is included in nep-exp, nep-ict, nep-mic and nep-mkt
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