The literature has established two kinds of entry bias in imperfectly competitive markets. First, free entry may lead to excessive entry relative to the socially optimal level. Second, free entry may lead to the wrong technology (type of firm) in the market compared to the socially optimal...

We consider a theoretical setting in which firms carry multiple products and consumers incur evaluation costs, not only across firms, but also within firms. Consumers judiciously decide the number of firms to include in their consideration sets as well as how many products from those firms. This...

This paper studies probabilistic selling with vertically differentiated products when firms compete and consumers anticipate the potential post-purchase regret raised by possibly obtaining the inferior products. Intuitively, anticipated regret hurts the attractiveness of probabilistic selling....

There are numerous evidence showing that consumers usually experience emotional dissonance (e.g. purchase regret) and anticipate it in consideration set formation process. Our paper investigates how anticipated regret affects consumers' consideration set formation and the relevant implications...