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Contribution Details
| Type | Journal Article |
| Scope | Discipline-based scholarship |
| Title | Preferences, confusion and competition |
| Organization Unit | |
| Authors |
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| Item Subtype | Original Work |
| Refereed | Yes |
| Status | Published in final form |
| Language |
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| Journal Title | Economic Journal |
| Publisher | Wiley-Blackwell Publishing, Inc. |
| Geographical Reach | international |
| ISSN | 0013-0133 |
| Volume | 132 |
| Number | 645 |
| Page Range | 1852 - 1881 |
| Date | 2022 |
| Abstract Text | Existing literature has argued that firms benefit from confusing consumers of homogeneous goods. This paper shows that this insight generally breaks down with differentiated goods and heterogeneous preferences: with polarised taste distributions, firms fully educate consumers. In cases where firms nevertheless confuse consumers, the welfare consequences are worse than for homogeneous goods, as consumers choose dominated options. Similar insights are also obtained for political contests, in which candidates compete for voters with heterogeneous preferences: parties choose ambiguous platforms only when preferences are ‘indecisive’, featuring a concentration of indifferent voters. |
| Free access at | Related URL |
| Related URLs | |
| Digital Object Identifier | 10.1093/ej/ueac009 |
| Other Identification Number | merlin-id:22501 |
| PDF File |
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| Keywords | Economics and econometrics |
| Additional Information | Earlier published as ECON Working Paper No. 344: https://www.zora.uzh.ch/id/eprint/187397/ |