The superiority of biased reviewers in a model of simultaneous sales

Working paper

This paper considers the impact of reviewers on sales of products of quality unknown to consumers. Sales occur simultaneously after consideration by a reviewer with a known level of bias. Consumers observe the reviewer's decision and a private signal. We find that: (a) with flexible prices and signals that are not too revealing the reviewer most biased against the product is best for profits; (b) with flexible prices and very revealing private signals the reviewer most biased in favour is optimal; (c) with fixed prices then a reviewer biased against, but close to unibased, is optimal.

Authors: Gill, D; Sgroi, D

• Publication status: Published
• Publisher: University of Oxford
• Series: Department of Economics Discussion Paper Series
• Publication date: 2004-09-01
• Paper number: 206
• Keywords: bias; private information; reviewers; simultaneous sales; marketing