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Please use this identifier to cite or link to this item: http://hdl.handle.net/10928/423

Title: Quality Signaling, Advertising and Firm Numbers
Authors: Tsui, Hsiao-Chien
Lin, Yi-Shiun
Issue Date: Nov-2013
Publisher: 成蹊大学アジア太平洋研究センター
Abstract: This paper investigates whether low-quality firms can pretend through advertising to be high-quality firms, which is a signal of product quality, when the number of firms increases. We assume that consumers remain loyal to high-quality firms after purchasing high-quality products and will therefore not patronize low-quality firms, which pretend through advertising to be high-quality firms. Our results indicate that the possibility of low-quality firms entering the high-quality market declines when the number of high-quality firms increases. Furthermore, the result of this paper suggests that if the number of low-quality firms is larger than that of high-quality firms, it may not be profitable for low-quality firms to advertise.
URI: http://hdl.handle.net/10928/423
Appears in Collections:No.38

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