Mandatory Quality Disclosure and Forward-looking Firm Behavior
نویسنده
چکیده
Mandatory quality disclosure is pervasive across several industries and often includes a period over which the quality of new entrants is unreported. This provides the opportunity for forward-looking firms to adjust product characteristics in advance of disclosure. Using comprehensive data on Medicare Advantage from 2007-2014, I first demonstrate empirically that there exists a consumer response to quality disclosure and persistence in market shares over time. I then investigate the presence of forward-looking behavior, where I find that low-quality firms benefit from nondisclosure of quality by charging higher premiums and offering less variety across markets.
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تاریخ انتشار 2016