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Matthew Mitchell (Economics - Rotman School of Management, University of Toronto.)

10 décembre 2018, 14h00–15h30

Salle MS 001

Industrial Organization seminar


Consumers rely on intermediaries ("influencers") such as social media recommendations to provide information about products. The advice may be mixed with endorsement in a way that is unobservable to the follower, creating a trade-off for influencers between the best advice and the most revenue. This paper models the dynamic relationship between an influencer and a follower. The relationship evolves between periods of less and more revenue. The model can provide insight into policies like the Federal Trade Commission's mandatory disclosure rules. An opt-in policy may be superior: it deregulates influencers who are reaping the rewards of past good advice.