Confusopoly: competition and obfuscation in markets

Kalayci, Kenan (2015) Confusopoly: competition and obfuscation in markets. Experimental Economics, 19 2: 299-316. doi:10.1007/s10683-015-9438-z

Author Kalayci, Kenan
Title Confusopoly: competition and obfuscation in markets
Journal name Experimental Economics   Check publisher's open access policy
ISSN 1386-4157
Publication date 2015
Year available 2015
Sub-type Article (original research)
DOI 10.1007/s10683-015-9438-z
Volume 19
Issue 2
Start page 299
End page 316
Total pages 18
Place of publication New York NY United States
Publisher Springer New York
Collection year 2016
Language eng
Abstract This paper examines the effects of competition in experimental posted-offer markets where sellers can confuse buyers. I report two studies. In one, the sellers offering heterogeneous goods can obfuscate buyers by means of spurious product differentiation. In the other study, sellers offer identical goods and make their prices unnecessarily complex by having multi-part tariffs. I vary the level of competition by having treatments with two and three- sellers in both studies, and having an additional treatment with five-sellers in one study. The results show that average complexity created by a seller is not different for the treatments with two, three and five sellers. In addition, market prices are highest and buyer surplus is lowest when there are two sellers in a market.
Keyword Experiment
Bounded rationality
Buyer confusion
Price complexity
Product complexity
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2016 Collection
School of Economics Publications
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