Disclosing Multiple Product Attributes

A product often has many attributes. The seller of the product may choose whether to disclose these attributes to consumers before their purchase. How do multiple attributes of the product jointly determine the seller's disclosure incentives? I analyze this question by modeling a monopolist whose product is characterized by vertical quality and a horizontal attribute. The monopolist does not always choose disclosure. When the product's vertical quality is common knowledge, a monopolist with higher vertical quality is less likely to disclose the horizontal attribute. When both vertical quality and the horizontal attribute of the product are known only to the monopolist, he is more likely to choose disclosure when vertical quality is higher. Nevertheless, the monopolist may choose nondisclosure even when his product has the highest possible vertical quality. The results shed light on mandatory disclosure policies and the design of quality surveys.

Ad revenue and content commercialization: Evidence from blogs

Many scholars argue that when incentivized by ad revenue, content providers are more likely to tailor their content to attract “eyeballs, ” and as a result, popular content may be excessively supplied. We empirically test this prediction by taking advantage of the launch of an ad-revenue-sharing program initiated by a major Chinese portal site in September 2007. Participating bloggers allow the site to run ads on their blogs and receive 50 % of the revenue generated by these ads. After analyzing 4.4 million blog posts, we find that, relative to nonparticipants, popular content increases by about 13 percentage points on participants ’ blogs after the program takes effect. About 50 % of this increase can be attributed to topics shifting toward three domains: the stock market, salacious content, and celebrities. Meanwhile, relative to nonparticipants, participants ’ content quality increases after the program takes effect. We also find that the program effects are more pronounced for participants with moderately popular blogs, and seem to persist after participants enroll in the program. Key words: ad-sponsored business model; media content; blog; revenue sharing; user-generated content; platform-based market

Ad Revenue and Content Commercialization: Evidence from Blogs

Many scholars argue that content providers, when incentivized by ad revenue, are more likely to tailor their content to attract “eyeballs,” and as a result, popular content may be excessively supplied. We empirically test this prediction by taking advantage of the launch of an ad-revenue-sharing program initiated by a major Chinese portal site in September 2007. Participating bloggers allow the site to run ads on their blogs and receive 50% of the revenue generated by these ads. After analyzing 4.4 million blog posts, we find that, relative to nonparticipants, popular content increases by about 13 percentage points on participants¡¯ blogs after the program takes effect. This increase can be partially attributed to topics shifting toward three domains: the stock market, salacious content, and celebrities. We also find evidence that, relative to nonparticipants, participants¡¯ content quality increases after the program takes effect.Ad-Sponsored Business Model, Media Content, Blog, Revenue-Sharing

Optimal search for product information

Consumers often need to search for product information before making purchase decisions. We consider a tractable (continuous-time) model of gradual learning, in which consumers incur search costs to learn further product information, and update their expected utility of the product at each search occasion. We characterize the optimal stopping rules for either purchase, or no purchase, as a function of search costs and of the importance/informativeness of each attribute. This paper also characterizes how the likelihood of purchase changes with the ex ante expected utility, search costs, and the importance/informativeness of each attribute. We discuss optimal pricing, the impact of consumer search on profits and social welfare, and how the seller chooses its price to strategically affect the extent of the consumers' search behavior. We show that lower search costs can hurt the consumer because the seller may then choose to charge higher prices. Discounting creates asymmetry in the purchase and no-purchase search thresholds, and may lead to lower prices if search occurs in equilibrium, or higher prices if there is no search in equilibrium. This paper also considers searching for signals of the value of the product, heterogeneous importance of attributes, endogenous intensity of search, and social learning.info:eu-repo/semantics/acceptedVersio