List Prices Signal Product Quality to a Behavioural Consumer

M, 2021

18mar12:00 pm1:00 pmList Prices Signal Product Quality to a Behavioural ConsumerEvent Type :Seminar Speaker: Dr. Johannes Paha

Event Details

In this model, a consumer is incompletely informed about the quality of two differentiated products, which causes an adverse selection problem. The manufacturers set list prices that are intended to serve as signals about quality. The retailers then decide about the actual transaction prices. Can the list prices be informative about product quality even if they are costless to transmit? They are uninformative for a rational consumer. A consumer who is subject to anchoring and loss aversion can, however, attain information about product quality and raise her surplus.


Dr. Johannes Paha


(Thursday) 12:00 pm - 1:00 pm


Microsoft Teams