Firm prominence and price framing

Chioveanu, I., Gu, Y. ORCID: https://orcid.org/0000-0002-4594-4852 and Wenzel, T. (2026) Firm prominence and price framing. Journal of Economic Behavior & Organization, 243. 107458. ISSN 2328-7616 doi: 10.1016/j.jebo.2026.107458

Abstract/Summary

This paper explores the strategic use of price framing in a duopoly where firms differ in their prominence and where both frame differentiation and frame complexity are sources of consumer confusion. It analyzes the interaction between the relative effectiveness of the two sources of consumer confusion and firms' prominence levels, and its impact on equilibrium outcomes. A parametric condition on firms' prominence delineates different equilibrium outcomes and synthesizes the interaction between firm prominence and consumer confusion. In equilibrium, firms do not always coordinate on the most effective source of confusion. The impact of consumer protection policy on market outcomes, especially consumer surplus, depends crucially on underlying market conditions, and can be ineffective or even detrimental to consumers.

Item Type	Article
URI	https://centaur.reading.ac.uk/id/eprint/128130
Identification Number/DOI	10.1016/j.jebo.2026.107458
Refereed	Yes
Divisions	Henley Business School > Real Estate and Planning
Publisher	Elsevier
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