Search Cost and Obfuscation Equilibrium: An Empirical Investigation

DOI

10.2991/aebmr.k.210803.022How to use a DOI?

Keywords

Obfuscation, Search cost, Advertising, Customer welfare

Abstract

Easy price search makes demand tremendously price-sensitive. However, merchants’ obfuscation strategy can hinder consumers from searching, thus greatly reducing their price sensitivity to other products. This paper presents an empirical examination of how obfuscation strategy affects consumers’ purchasing decisions. The author improves the model proposed by Glenn Ellison and Sara Fisher Ellison and applies the observed data from taobao.com and tmall.com to the model. This paper proves that, for some products in these two websites, the prices and the rankings can significantly affect sales volume, and for some products, merchants will adopt obfuscation strategies for low-quality products to maximize their profits.

Copyright

© 2021, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

TY  - CONF
AU  - Yiyu Chen
PY  - 2021
DA  - 2021/08/04
TI  - Search Cost and Obfuscation Equilibrium: An Empirical Investigation
BT  - Proceedings of the  1st International Symposium on Innovative Management and Economics (ISIME 2021)
PB  - Atlantis Press
SP  - 152
EP  - 160
SN  - 2352-5428
UR  - https://doi.org/10.2991/aebmr.k.210803.022
DO  - 10.2991/aebmr.k.210803.022
ID  - Chen2021
ER  -