Knowledge that Transforms

This paper investigates how consumer impatience affects competition and how delivery technology may reshape market structure in online retail markets.

A natural experiment reveals that an ad ban reduces sales of a grocery retailer by 6% but does not affect overall market size.

When small business owners in Rwanda start seeking feedback from some of their customers, we find that customers from whom feedback is not sought also respond to changes made by the businesses by increasing their sales at these stores.

This paper shows that movie crowd reviewers provide evaluations that are biased against movies with a stronger female presence relative to professional critics.

This paper studies how expanding product assortments on an online food delivery platform increases consumer acquisition but decreases purchase frequency among existing customers.

We use neural networks for structural model estimation, achieving both accuracy and computational efficiency, particularly for models with high simulation costs.

This paper estimates the drivers of playlist followers on Spotify using a panel data set for 30,000+ popular playlists and combines it with data on how prominently these playlists are featured in the Spotify app.

When a firm releases its product later than its competitor, the firm loses sales because many consumers prefer to buy the competitor’s product rather than wait for the firm’s product release. Therefore, in the absence of any late-mover advantages, conventional wisdom suggests that competing firms will release their products as soon as possible to avoid losing customers if they were to enter later. However, when the market evolves over time and consumers are forward-looking, we demonstrate that this intuition fails and propose a new explanation for why a firm may strategically release its product later than its competitor. Namely, a firm’s late entry can help alleviate price competition due to some consumers’ decisions to wait for the firm’s product release instead of buying a currently available product. We show that in markets where the growth rate is sufficiently high and differentiation between firms is not too low, the firm’s profit gain from alleviated price competition dominates its profit loss from reduced sales, making the firm better off by releasing its product later than the competitor. Surprisingly, when the fraction of consumers who enter the market relatively early increases, the firm may have even greater incentives to release its product late. Finally, we consider markets where firms are differentiated both horizontally and vertically, with one firm having a higher quality (or stronger brand image) than its competitor. We find that high level of vertical differentiation will induce both high- and low-quality firms to rush to the market, releasing their products in the early period. However, when vertical differentiation is moderately high, the high-quality firm may choose to release late, whereas the low-quality firm will prefer to release its product early. History: Anthony Dukes served as the senior editor for this article.