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Abstract
In a monopoly setting where consumers cannot observe the quality of the product we show that free samples which are of a lower quality than the marketed digital goods are used together with high prices as signals for a superior quality if the number of informed consumers is small and if the difference between the high and the low quality is not too small. Social welfare is higher, if the monopolist uses also free samples as signals, compared to a situation where he is restricted to pure price signalling. Both, the monopolist and consumers benefit from the additional signal.
| Dokumententyp: | Paper |
|---|---|
| Keywords: | Digital Goods, Free Samples, Multi-dimensional Signalling |
| Fakultät: | Sonderforschungsbereiche > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems
Sonderforschungsbereiche > Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems > A1 - Allokationsmechanismen in Organisationen und Märkten |
| Themengebiete: | 300 Sozialwissenschaften > 330 Wirtschaft |
| JEL Classification: | D21, D82, L15 |
| URN: | urn:nbn:de:bvb:19-epub-13480-5 |
| Sprache: | Englisch |
| Dokumenten ID: | 13480 |
| Datum der Veröffentlichung auf Open Access LMU: | 10. Jul. 2012, 13:11 |
| Letzte Änderungen: | 04. Nov. 2020, 12:53 |
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