The value of recommendations

• 成果类型: Article
• 署名作者: Miklos-Thal, Jeanine; Schumacher, Heiner
• 署名单位: University of Rochester; Goethe University Frankfurt
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2013.01.005
• 发表日期: 2013
• 页码: 132-147
• 关键词: Repeated games; moral hazard; imperfect monitoring; Information sellers

摘要

Many markets without repeated seller buyer relations feature third-party monitors that sell recommendations. We analyze the profit-maximizing recommendation policies of such monitors. In an infinitely repeated game with seller moral hazard and short-lived consumers, a monopolistic monitor with superior information about the seller's past effort decisions sells recommendations about the seller to consumers. We show that the monitor has an incentive to make its recommendations hard to predict, which in general leads to inefficient effort provision by the seller. These results hold under perfect and imperfect monitoring and in a variety of informational setting. When there are multiple competing sellers, the conflict between the monitor's profit-maximization objective and efficient effort provision is mitigated. (c) 2013 Elsevier Inc. All rights reserved.