How limiting deceptive practices harms consumers

Salvatore Piccolo, Piero Tedeschi, Giovanni Ursino

Risultato della ricerca: Contributo in rivistaArticolo in rivistapeer review

20 Citazioni (Scopus)


There are two competing sellers of an experience good, one offers high quality, one low. The low-quality seller can engage in deceptive advertising, potentially fooling a buyer into thinking the product is better than it is. Although deceptive advertising might seem to harm the buyer, we show that he could be better off when the low-quality seller can engage in deceptive advertising than not. We characterize the optimal deterrence rule that a regulatory agency seeking to punish deceptive practices should adopt. We show that greater protection against deceptive practices does not necessarily improve the buyer welfare.
Lingua originaleEnglish
pagine (da-a)611-624
Numero di pagine14
RivistaRAND Journal of Economics
Stato di pubblicazionePubblicato - 2015


  • Consumer protection
  • Deceptive advertising
  • Rational buyer


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