An economic analysis of product pre-announcements

Jay Pil Choi, Eirik Gaard Kristiansen, Jae Hyon Nahm

Research output: Contribution to journalArticle

7 Citations (Scopus)

Abstract

In markets with ongoing technological progress, buyers must choose when to buy. These buy/wait decisions may have a significant impact on innovators' and buyers' surpluses. In making these decisions, buyers often rely on information provided by firms. For instance, it is a common practice for firms to announce new products well in advance of actual market availability in information goods industries such as computer software. However, since sellers and buyers, in many cases, have opposing interests, it is difficult for a firm to make credible product pre-announcements. In this paper, we study when and how firms can make credible pre-announcements. We focus particularly on how firms can build a reputation for being honest. We also review the literature on the effects of product pre-announcement on market competition and discuss several open issues in need of further research.

Original languageEnglish
Pages (from-to)299-319
Number of pages21
JournalCESifo Economic Studies
Volume51
Issue number2-3
DOIs
Publication statusPublished - 2005 Jun 1
Externally publishedYes

Fingerprint

economic analysis
firm
economics
market
technological progress
innovator
reputation
decision making
product
Economic analysis
Preannouncements
software
Buyers
industry

ASJC Scopus subject areas

  • Economics and Econometrics
  • Geography, Planning and Development

Cite this

An economic analysis of product pre-announcements. / Choi, Jay Pil; Kristiansen, Eirik Gaard; Nahm, Jae Hyon.

In: CESifo Economic Studies, Vol. 51, No. 2-3, 01.06.2005, p. 299-319.

Research output: Contribution to journalArticle

Choi, Jay Pil ; Kristiansen, Eirik Gaard ; Nahm, Jae Hyon. / An economic analysis of product pre-announcements. In: CESifo Economic Studies. 2005 ; Vol. 51, No. 2-3. pp. 299-319.
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