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Search Deterrence

Mark Armstrong and Jidong Zhou ()

MPRA Paper from University Library of Munich, Germany

Abstract: This paper studies sales techniques which discourage consumer search by making it harder or more expensive to return to buy after a search for alternatives. It is unilaterally profitable for a seller to deter search under mild conditions, but sellers can suffer when all do so. When a seller cannot commit to its policy, it exploits the inference that those consumers who try to buy later have no good alternative, and in many cases the outcome is as if the seller could only make an exploding offer. Search deterrence results in sub-optimal matching of products to consumers and often raises the price consumers pay.

Keywords: Consumer search; price discrimination; sequential screening; exploding offers; sales techniques (search for similar items in EconPapers)
JEL-codes: D18 D43 D82 D83 D86 L13 (search for similar items in EconPapers)
Date: 2014-12
New Economics Papers: this item is included in nep-com, nep-cta and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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https://mpra.ub.uni-muenchen.de/60891/1/MPRA_paper_60891.pdf original version (application/pdf)

Related works:
Journal Article: Search Deterrence (2016) Downloads
Working Paper: Search Deterrence (2013) Downloads
Working Paper: Search Deterrence (2013) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:60891

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