Regulating Product Communication

• 成果类型: Article
• 署名作者: Janssen, Maarten C. W.; Roy, Santanu
• 署名单位: University of Vienna; HSE University (National Research University Higher School of Economics); Centre for Economic Policy Research - UK; Southern Methodist University
• 刊物名称: AMERICAN ECONOMIC JOURNAL-MICROECONOMICS
• ISSN/ISSBN: 1945-7669
• DOI: 10.1257/mic.20190187
• 发表日期: 2022
• 页码: 245-283
• 关键词: disclosure; QUALITY; price; perceptions; COMPETITION; MODEL

摘要

Information regulation that penalizes deceptive communication by firms can have significant unintended consequences. We consider a market where competing firms communicate private information about product quality through a combination of pricing and direct communication (advertising or labeling) that may be false. A higher fine for lying reduces the reliance on price signaling, thereby lowering market power and consumption distortions; however, it may lead to excessive disclosure. Low fines are always worse than no fines. High fines are welfare improving only if communication itself is inexpensive. Penalizing false claims may reduce profits of both high-and low-quality firms.