The Effects of Incomplete Information on Consumer Choice
Author : Ran Kivetz
Publisher :
Page : 57 pages
File Size : 30,55 MB
Release : 2000
Category : Consumers' preferences
ISBN :
Author : Ran Kivetz
Publisher :
Page : 57 pages
File Size : 30,55 MB
Release : 2000
Category : Consumers' preferences
ISBN :
Author : James R. Bettman
Publisher : Addison Wesley Publishing Company
Page : 424 pages
File Size : 18,20 MB
Release : 1979
Category : Business & Economics
ISBN :
Author : Miloš Duško Graonic
Publisher :
Page : 352 pages
File Size : 22,60 MB
Release : 1995
Category :
ISBN :
Author : Frank Huettner
Publisher :
Page : 52 pages
File Size : 33,18 MB
Release : 2018
Category :
ISBN :
Consumers often do not have complete information about the choices they face and therefore have to spend time and effort in acquiring information. Since information acquisition is costly, consumers trade-off the value of better information against its cost, and make their final product choices based on imperfect information. We model this decision using the rational inattention approach and describe the rationally inattentive consumer's choice behavior when she faces alternatives with different information costs. To this end, we introduce an information cost function that distinguishes between direct and implied information. We then analytically characterize the optimal choice probabilities. We find that non-uniform information costs can have a strong impact on product choice, which gets particularly conspicuous when the product alternatives are otherwise very similar. There are significant implications on how a seller should provide information about its products and how changes to the product set impacts consumer choice. For example, non-uniform information costs can lead to situations where it is disadvantageous for the seller to provide easier access to information for a particular product, and to situations where the addition of an inferior (never chosen) product increases the market share of another existing product (i.e., failure of regularity). We also provide an algorithm to compute the optimal choice probabilities and discuss how our framework can be empirically estimated from suitable choice data.
Author : Victor P. Goldberg
Publisher :
Page : 58 pages
File Size : 45,29 MB
Release : 1973
Category : Consumer education
ISBN :
Author : W. Fred van Raaij
Publisher :
Page : 224 pages
File Size : 43,63 MB
Release : 1977
Category : Commercial products
ISBN :
Author : Frank Hüttner
Publisher :
Page : pages
File Size : 28,94 MB
Release : 2016
Category :
ISBN :
Consumers often do not have complete information about the choices they face and therefore have to spend time and effort in acquiring information. Since information acquisition is costly, consumers have to trade-off the value of better information against its cost, and make their final choices based on imperfect information. We model this decision using the rational inattention approach and describe the rationally inattentive consumer's choice behavior when she faces options with different information costs. To this end, we introduce an information cost function that distinguishes between direct and inferential information. We then analytically characterize the optimal behavior and derive the choice probabilities in closed-form. We find that non-uniform information costs can have a strong impact on product choice, which gets particularly conspicuous when the product alternatives are otherwise very similar. It can also lead to situations where it is disadvantageous for the seller to provide easier access to information for a particular product. Furthermore, it provides a new explanation for strong failure of regularity of consumer behaviour, which occurs if the addition of an inferior - never chosen - product to the choice set increases the market share of another existing product.
Author : Andrew A. Mitchell
Publisher :
Page : 136 pages
File Size : 37,16 MB
Release : 1978
Category : Business & Economics
ISBN :
Abstract: In order to understand how the market system provides information to buyers, the effect of information on consumer and market behavior is examined from the perspectives of economics, consumer psychology, and public policy. Economic analyses of information transmission and advertising are presented. Effects of different types of information on the behavior of firms, and information search strategies which consumers use to extract information from mass media advertisements are evaluated. Theories of information encoding and storage are described in terms of their implications for consumer research. The causes of information imperfections in local consumer markets (markets where different prices are charged for the same quality) are reviewed. Advertising regulation policy considerations are also examined. Consumer information systems for local services are discussed from the viewpoint of information needs and consumer patterns of information avoidance. (nm).
Author : Curtis P. Haugtvedt
Publisher : Psychology Press
Page : 1892 pages
File Size : 39,23 MB
Release : 2018-12-07
Category : Psychology
ISBN : 1136676201
This Handbook contains a unique collection of chapters written by the world's leading researchers in the dynamic field of consumer psychology. Although these researchers are housed in different academic departments (ie. marketing, psychology, advertising, communications) all have the common goal of attaining a better scientific understanding of cognitive, affective, and behavioral responses to products and services, the marketing of these products and services, and societal and ethical concerns associated with marketing processes. Consumer psychology is a discipline at the interface of marketing, advertising and psychology. The research in this area focuses on fundamental psychological processes as well as on issues associated with the use of theoretical principles in applied contexts. The Handbook presents state-of-the-art research as well as providing a place for authors to put forward suggestions for future research and practice. The Handbook is most appropriate for graduate level courses in marketing, psychology, communications, consumer behavior and advertising.
Author : Leon Schiffman
Publisher : Pearson Higher Education AU
Page : 729 pages
File Size : 13,23 MB
Release : 2013-10-15
Category : Business & Economics
ISBN : 1486014348
A trusted resource for Consumer Behaviour theory and practice. Consumer Behaviour explores how the examination and application of consumer behaviour is central to the planning, development, and implementation of effective marketing strategies. In a clear and logical fashion, the authors explain consumer behaviour theory and practice, the use and importance of consumer research, and how social and cultural factors influence consumer decision making. The sixth edition of this Australian text provides expanded coverage of contemporary topics.