Bayesian consumers infer that hidden add-on prices (e.g. the cost of ink for a printer) are likely to be high prices. If consumers are Bayesian, firms will not shroud information in equilibrium. However, shrouding may occur in an economy with some myopic (or unaware) consumers. Such shrouding...

In online social networks, social information, i.e., content generated and shared by users (e.g., past purchases), can be a substitute for sponsored advertising, which constitutes the network's main source of revenue. When will social information be let to spread freely over the platform? We...

Marketing researchers have traditionally modeled sales promotions by introducing a sales promotion dummy variable (sometimes accompanied by its interaction with prices) in the indirect utility specification. This approach has been useful in reproducing consumers' response to sales promotions but...

We test an information theory of prosocial behavior whereby ego utility and self-signaling crowd out the effect of consumption utility on choice. The data come from two field experiments involving purchases of a consumer good bundled with a charitable donation. Across experimental cells, we...

We test a self-signaling theory using two large-scale, randomized controlled field experiments. Smartphone users are randomly sampled to receive promotional offers for movie tickets via SMS technology. Subjects are exposed to different pre-determined levels of price discounts and charitable...

We study trust building in credence goods markets in a dynamic setting. An extreme lemon problem arises in the one-shot game and results in no trade. In the repeated game, an expert's honesty is monitored through consumers' rejection of his recommendations. We characterize the optimal...

The diversion ratio is a key input to indicators of merger harm like upward pricing pressure. Measuring the diversion ratio, however, is challenging in the presence of consumer switching costs. We propose an identification strategy for diversion that relies on win/loss data from the two merging...