Events at CERGE-EI

Pia Ennuschat

Universitat Pompeu Fabra, Spain

Abstract: A monopolistic seller offers a product through a platform to partially informed consumers. The platform observes both consumers’ preferences and their existing information and decides how much additional information to disclose. I consider different objectives for the platform and show how the platform designs disclosure to shape the elasticity of demand depending on its objective. I characterize the set of feasible welfare outcomes and show that total surplus is maximized when the platform maximizes consumer surplus and decreases whenever the platform pursues any other objective, such as profit maximization.

Full Text: Targeted Information Design: Shaping Markets with heterogeneous consumers