On the Interaction Between Cheap-Talk Advertising and Credible Product Reviews

• 成果类型: Article
• 署名作者: Jia, Xue; Suijs, Jeroen
• 署名单位: University of Melbourne; Erasmus University Rotterdam - Excl Erasmus MC; Erasmus University Rotterdam
• 刊物名称: PRODUCTION AND OPERATIONS MANAGEMENT
• ISSN/ISSBN: 1059-1478
• DOI: 10.1177/10591478241279987
• 发表日期: 2025
• 页码: 262-278
• 关键词: information acquisition; Cheap-Talk Advertising; Third-Party Product Reviews; signaling

摘要

This paper investigates the interaction between cheap-talk advertising and credible third-party product reviews to inform customers about product quality. We find that cheap-talk advertising can be informative when the firm's private information helps predict a credible product review. A more informative credible product review has two effects on cheap-talk advertising. First, a credible product review plays a disciplinary role that enables the firm to provide informative advertising. Second, it reduces the incremental value of cheap-talk advertising. We find that, in equilibrium, whether or not the advertising is consistent with a credible product review is informative about product quality. The results also imply that an overly informative product review can reduce the total information available to customers by deterring the firm from providing informative advertising.