Buyer confusion and market prices

Kalaycı, Kenan; Potters, Jan

doi:10.1016/j.ijindorg.2010.06.004

Cited by 79 publications

(46 citation statements)

References 18 publications

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“…Supporting experimental evidence is found in the aforementioned Kalayci and Potters (2011). However, experimental asset markets often choose stylized parameters for reasons of tractability and closeness to theory, so the external validity of the result should not be taken at face value.…”

Section: Discussionmentioning

confidence: 66%

“…Webb (2014) uses an identical behavioural mechanism to this article in a vertically differentiated market, but with simultaneous rather than sequential quality choice. Kalayci and Potters (2011) investigate experimentally a market in which buyers find it difficult to distinguish between goods. Their experimental design represents goods' value by a sum that is hard to compute accurately in the time that is allowed for decision making.…”

Section: Literature Reviewmentioning

confidence: 99%

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If It’s All the Same to You: Blurred Consumer Perception and Market Structure

Webb

2016

Rev Ind Organ

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Consumers with bounded perception treat sufficiently similar goods as homogeneous. The effects of bounded perception on a vertically differentiated duopoly with sequential quality choice are examined. When quality entails fixed costs the market becomes more concentrated. When quality entails marginal costs, the second mover may profitably imitate the product of its rival, and the market is either more or less concentrated depending on how bounded perception is. When firms incur entry costs, neither firm may opt to produce when quality entails marginal costs, whereas at least one firm always produces when quality entails fixed costs.

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Section: Discussionmentioning

confidence: 66%

Section: Literature Reviewmentioning

confidence: 99%

If It’s All the Same to You: Blurred Consumer Perception and Market Structure

Webb

2016

Rev Ind Organ

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“…Kalayci and Potters (2011) examine whether buyer confusion increases market prices and find results that support the effectiveness of buyer confusion. Kalayci (2015b) presents experimental evidence that a seller's complexity and price choices are positively correlated.…”

Section: Contents Lists Available At Sciencedirectmentioning

confidence: 99%

“…15 Similar results are obtained if we consider the effects for the treatment SYM. 16 Relatedly, Kalayci and Potters (2011) report evidence from a laboratory experiment where participants take both the roles of sellers and buyers. Sellers can make price comparisons harder by deciding on the number of attributes of a product.…”

Section: Pricesmentioning

confidence: 99%

Putting on a tight leash and levelling playing field: An experiment in strategic obfuscation and consumer protection

Wenzel

2015

International Journal of Industrial Organization

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The paper reports the results of an experiment where asymmetric sellers of a product can obfuscate the market. We show that policy measures may have unintended effects of increasing obfuscation incentives. We find that policies that limit the effectiveness of obfuscation and policies that promote parity between firms can lead less prominent firms to increase their obfuscation efforts. Despite this unintended effect, however, the former type of policies is effective in boosting consumer welfare.

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“…The present paper is most closely related to Kalaycı and Potters (2011). While, Kalaycı and Potters (2011) duopoly market experiment examines complexity on the quality dimension of goods, the present paper looks at the effects of complexity on the price dimension.…”

Section: Introductionmentioning

confidence: 99%