Advertising, Search and Matching: Econometric Models and Applications

该奖项资助信息在推动消费者选择中的作用的研究，特别关注零售银行和电力行业。传统的消费者行为经济模型通常假设消费者完全了解他们的选择。然而，在许多产品市场上观察到的持续的价格分散表明，在许多市场上存在着重大的搜索和转换摩擦。这种摩擦可能会阻碍竞争力量实现有效的结果，了解这些摩擦的相关性和规模是评估监管干预的必要性和影响的关键。为了充分理解和量化这些摩擦所扮演的角色，我们需要关于消费者选择的详细信息，特别是选择过程。因此，该研究项目利用了关于个人消费者选择的详细数据，纳入了搜索/转换成本的明确模型，并考虑到关于替代品的有限信息。美国零售银行业拥有14万亿美元的资产，约有7,000家银行和8万多家分行，是零售经济和金融体系中极其重要的一部分。了解消费者如何决定他们的零售银行服务提供商，以及他们是否面临搜索和转换摩擦，是解开这一重要经济部门竞争和创新驱动力的关键投入。关于零售银行业务的项目利用了一套独特的数据，其中载有关于消费者购物过程的整个购买漏斗的信息：（1）认识，（2）考虑，最后（3）购买。该数据集是第一个提供购买漏斗各个阶段详细数据的数据集，也是第一个研究零售银行业务的数据集，零售银行业务是一个非常重要的经济部门，但尚未经常通过现代经验产业组织的透镜进行审查。该数据集还辅之以广告和产品特征方面的信息，以估计个人消费者一级非常详细的购物和决策模式。这些数据和模型使研究人员能够评估（1）使消费者行为合理化的搜索和转换成本的大小，以及（2）广告是否主要有效地提高了意识或驱动选择的意识。PI还将开发类似的实证方法来研究在24个州运行的放松管制的零售电力市场中的消费者选择。从这项研究的见解，以及利用其他电力市场环境中的经验方法，可以帮助市场监测和监管机构制定政策，以进一步提高这些市场的竞争力和效率。 该项目将利用来自德克萨斯州住宅电力选择计划的非常详细的用户级数据。研究小组将开发一个计量经济学模型，考虑到搜索和切换为基础的选择摩擦。 该模型将被用来评估这种选择摩擦是否可以解释现有供应商与进入者的市场份额和价格的演变，以及如何干预，如信息运动，以减少搜索/转换成本可能会影响市场结构和消费者福利。

This award funds research on the role of information in driving consumer choices, with special attention to retail banking and electricity industries.Traditional economic models of consumer behavior typically assume that consumers are fully informed about their alternatives. However, the observation of persistent price dispersion in many product markets suggests that significant search and switching frictions are present in many markets. Such frictions may impede forces of competition from achieving efficient outcomes, and understanding the relevance and magnitude of these frictions is key to assessing the necessity and impact of regulatory interventions. To fully understand and quantify the role played by these frictions, we need detailed information on consumer choices, and especially the choice-making process. Therefore, the research project utilizes detailed data on individual consumers' choices, incorporates explicit models of search/switching costs and allows for limited information about alternatives. With its 14 trillion dollars of assets, about 7,000 banks and more than 80,000 bank branches, the U.S. retail banking sector is an extremely important portion of the retail economy as well as the financial system. Understanding how consumers decide on their retail banking provider and whether they face search and switching frictions is a crucial input into unpacking the drivers of competition and innovation in this important sector of the economy. The project on retail banking utilizes a unique data set with information on the entire purchase funnel of consumers' shopping process: (1) awareness, (2) consideration, and, finally, (3) purchase. The data set is among the first to provide detailed data on all stages of the purchase funnel, as well as being the first of its kind to study retail banking, a very important sector of the economy that has not been frequently scrutinized through the lens of modern empirical industrial organization. The data set is also complemented with information on advertising and product characteristics to estimate a very detailed model of shopping and decision-making at the individual consumer level. The data and the model allows the researchers to assess (1) what the magnitude of search and switching costs are that rationalize consumer behavior, and (2) whether advertising is primarily effective in increasing awareness or driving choice conditional on awareness.The PI will also develop similar empirical methods to study consumer choices in deregulated retail electricity markets, which are in operation in 24 states. Insights from this study as well as the utilization of the empirical methods developed here in other electricity market contexts can aid market monitors and regulators to devise policies to further the competitiveness and efficiency of these markets. The project will utilize very detailed subscriber level data from Texas' residential electricity choice program. The research team will develop an econometric model that allows for search and switching based choice frictions. The model will be used to assess whether such choice frictions can explain the evolution of market shares and prices of the incumbent providers vs. entrants, and how interventions such as informational campaigns to reduce search/switching costs may affect market structure and consumer welfare.