Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/174500
Authors: 
Hillenbrand, Adrian
Hippel, Svenja
Year of Publication: 
2017
Series/Report no.: 
Preprints of the Max Planck Institute for Research on Collective Goods 2017/21
Abstract: 
Online platforms provide search tools that help consumers to get betterfitting product offers. But this technology makes consumer search behavior also easily traceable for the platform and allows for real-time price discrimination. Consumers face a trade-off: Search intensely and receive better fits at potentially higher prices or restrict search behavior - be strategically inattentive - and receive a worse fit, but maybe a better deal. We study the strategic buyer-seller interaction in such a situation theoretically as well as experimentally. The search technology we use in the laboratory leads by construction to better-fitting products, but we indeed find that only sellers profit from the buyers' use of the offered search tools.
Subjects: 
strategic inattention
price discrimination
information transmission
consumer choice
experiment
JEL: 
D11
D42
D82
D83
L11
Document Type: 
Working Paper

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