Robin Ng (University of Mannheim)

will give a presentation on

Competition through Recommendations

Abstract:

This paper explores if and how platforms should design informative recommendation systems. I show that monopolist platforms prefer recommendation systems that are more informative than value-for-money. When facing competition, platforms reduce the informativeness of their recommendations as their rivals provide more informative recommendations, but never prefer recommendations that are worse than value-for-money. I also show that naive consumers result in more informative recommendations because it is more difficult for the platform to attract consumers.