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Contact
Information: H. John Heinz III School of Public Policy and Management and Tepper School of Business Carnegie Mellon University 4800 Forbes Avenue, HBH 2105D Pittsburgh PA, 15217 Email: 
Voice: 412-268-5978 Fax: 412-268-5338 Office: Hamburg Hall 2105D Assistant: Gretchen Hunter (Hamburg Hall 2101, 412-268-6076) |
New:
- July-08: Here is an updated version of a paper using
shopbot data to infer consumer search costs in online
markets. We find that consumers face high costs to
search for information online, even in the
“nearly perfect” market of the shopbot.
- July-08: Here is a new paper that examines
personalization strategies available to Internet
firms.
- June-08: Here is a new paper that used a hierarchical
Bayesian model to analyze the impact of position on
profitability within sponsored search results at
Google. We find that while the first position within
sponsored search results generates the highest
click-throughs, it is not necessarily the most
profitable position. We use an analytic model to argue
that this could be because of heterogeneity in search
costs across consumers and the additional browsing
cost incurred in evaluating products across multiple
websites.
- June-08: Here is an updated version of a paper that
uses data from the flash memory market to empirically
show that the presence of digital converters reduced
the price premium of leading flash memory card
formats. This made producers of non-dominant standards
better off. We argue that this had various positive
benefits for the market, including increased the
overall product variety.
- May-08: iTunes now has the audio and video of a talk on this paper (dealing with the impact
of television broadcasts on DVD sales and Internet
piracy is now available in the Heinz School’s
podcast feed.
- May-08: Here is an updated version of a paper using data
from Amazon.com to show that when evaluating product
reviews online, consumers pay more attention to
reviews that the Amazon community has designated
reliable than other reviews. We argue that these sorts
of community feedback mechanisms provide a direct
benefit to consumers in terms of evaluating reviews
from strangers, and also an indirect benefit in terms
of making it harder for self-interested parties to
manipulate online reviews.
- Apr-08: We have a new paper that looks at how the
importance of network effects might change in the
context of purely digital goods that can be easily
converted from one format to another. We develop a
model of sequential duopoly competition and
proprietary technology standards. We find that unless
network effects are very large, firms will provide
converters to all consumers. This makes both the
entrant and incumbent better off since the provision
of converters alleviates price competition in the
market.
- Jan-08: Here is a new paper that examines the impact of
used markets on sales of CDs and DVDs. In prior work,
we found that markets for used books sold on Amazon
did not significantly cannibalize new book sales. In
this follow-on work we find that used CDs and DVDs do
significantly cannibalize new product sales, possibly
because of the digital nature of the product. We argue
that this result provides a further advantage to
digital distribution strategies for firms selling
digital goods because digitally distributed goods are
not subject to the first sale doctrine and thus cannot
be sold in used markets.
- Dec-07: This paper analyzing strategic pricing
issues in content delivery networks has been accepted
for publication at Management Science
- Dec-07: This paper was the first runner-up for
the Information Systems Research best
published paper award for 2007.
- Nov-07: Here is a new paper that examines the impact of
television broadcasts on DVD sales and Internet
piracy. Using a new dataset, we find that television
broadcasts of movies result in an immediate increase
in the demand for DVDs of that movie and in the demand
for pirated copies of that movie. However, we also
find that the presence of pirated material at the time
of broadcast does not reduce the demand for DVDs. That
is, consumers who are interested in purchasing the
DVD, are not dissuaded from that purchase by the
presence of pirated material, at least for the movies
in our sample.