To make high-quality research more accessible and easier to explore.

Fields:

Testing Models of Consumer Search Using Data on Web Browsing and Purchasing Behavior

American Economic Review 2012 102(6), 2955-2980 open access
Using a large dataset on web browsing and purchasing behavior we test to what extent consumers are searching in accordance to various search models. We find that the benchmark model of sequential search with a known price distribution can be rejected based on recall patterns found in the data as well as the absence of dependence of search decisions on prices. Our findings suggest fixed sample size search provides a more accurate description of search behavior. We then utilize the fixed sample size search model to estimate demand elasticities of online bookstores in an environment where store preferences are heterogeneous.