Elliott, M., Galeotti., A., Koh., A, and Li, W.
Market Segmentation Through Information
JIWP Number: 2114
Abstract: An information designer has information about consumers' preferences over products sold by oligopolists and chooses what information to reveal to firms who, then, compete on price by making personalized offers. We study the market outcomes the designer can achieve. The information designer is a metaphor for an internet platform which uses data on consumers to target advertisements that include discounts and promotions. Our analysis demonstrates the power that users' data can endow internet platforms with, and speaks directly to current regulatory debates.
Keywords: Information design, market segmentation, price discrimination
JEL Codes: D43 D83 L13
Author links: Matthew Elliott
PDF: jiwp2114.pdf 
Open Access Link: 10.17863/CAM.99007
