Risk aversion and apparently persuasive advertising
By: Bharat N. Anand, Ron Shachar
Contributors: Shachar, Ron; Harvard Business School. Division of Research
Series: Working paper / Division of Research, Harvard Business School -- 02-099; Working paper (Harvard Business School. Division of Research) -- 02-099
Publisher: Division of Research, Harvard Business School
Published: 2002
Place of publication: Boston]
Language: eng
Description: Previous empirical studies demonstrated that exposure to advertisements increases a consumers' tendency to buy the promoted product. Thestandard interpretation of this empirical regularity is that advertising intensity is an element of the utility. Here we show that if consumers are risk-averse and advertising conveys information about product attributes, the empirical regularity can be explained even without assuming that utility is a function of ad intensity.
Notes: Includes bibliographical references.