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Ordered search with asymmetric product design
Authors:Hui?Song  author-information"  >  author-information__contact u-icon-before"  >  mailto:songh@sdu.edu.cn"   title="  songh@sdu.edu.cn"   itemprop="  email"   data-track="  click"   data-track-action="  Email author"   data-track-label="  "  >Email author
Affiliation:1.School of Economics,Shandong University,Jinan,China;2.Research Center for Games and Economic Behavior, School of Economics,Shandong University,Jinan,China
Abstract:Two firms sell horizontally differentiated products on a platform; one product has generic design, whereas the other has polarized design. Consumers search sequentially for products and prices. We show that there always exists an equilibrium where firms correctly expect consumers to first search the product with polarized design. If the platform is able to choose a search order for consumers, generally it lets consumers search the product with polarized design first. The polarized–generic ordering can be achieved using a generalized English auction when product designs cannot be observed by the platform.
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