Strategic obfuscation and consumer protection policy

Yiquan Gu, Tobias Wenzel

Research output: Contribution to journalArticle

19 Citations (Scopus)
179 Downloads (Pure)

Abstract

This paper studies obfuscation decisions by firms. We show that more prominent firms are more likely to obfuscate. While prominent firms always choose maximum obfuscation, the obfuscation by less prominent firms depends on the degree of asymmetry in prominence and consumer protection policy. We evaluate the impact of a consumer protection policy that limits the scope of obfuscation. We show that such a policy may not be effective as less prominent firms may increase their obfuscation practice.

Original languageEnglish
Pages (from-to)632-660
Number of pages29
JournalJournal of Industrial Economics
Volume62
Issue number4
DOIs
Publication statusPublished - 1 Dec 2014

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