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Information Gathering and Marketing


  • The authors thank the coeditor, two anonymous referees, participants at EARIE 2007 (Valencia), Haas School of Business, Berkeley, IIOC 2007 (Savannah), LSE, Michigan State University, Oxford, Stern Marketing lunch, Stern Micro lunch, University of Sydney, Utah Winter Business Economics Conference, Workshop on the Economics of Advertising and Marketing (Bad Homburg), Simon Anderson, Simon Board, Jim Dana, Andrew Daughety, Hao Li, Regis Renault, and, particularly, Yuk-Fai Fong and Monic Jiayin Sun for detailed and helpful comments. Guillermo Caruana acknowledges the financial support of the Spanish Ministry of Science and Innovation through the Consolider-Ingenio 2010 Project “Consolidating Economics.” Vicente Cuñat acknowledges the support from Universitat Pompeu Fabra and Barcelona Graduate School of Economics.


Consumers have only partial knowledge before making a purchase decision, but can acquire more-detailed information. Marketing makes it easier or harder for these consumers to do so. When consumers are ex ante heterogeneous, the firm might choose an intermediate marketing strategy for two quite different reasons. First, as a nonprice means of discrimination—it can make information only partially available, in a way that induces some, but not all, consumers to acquire the information. Second, when the firm cannot commit to a given investment in ensuring quality, the marketing and pricing strategy can act as a commitment device.