Replication data for: Does Cheap Talk Affect Market Outcomes? Evidence from eBay
Principal Investigator(s): View help for Principal Investigator(s) Daniel W. Elfenbein; Raymond Fisman; Brian McManus
Version: View help for Version V1
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| EFM-AEJ-programs | 12/07/2019 01:28:PM | ||
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application/vnd.openxmlformats-officedocument.wordprocessingml.document | 13.6 KB | 12/07/2019 08:28:AM |
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application/pdf | 53.9 KB | 12/07/2019 08:28:AM |
Project Description
Summary:
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We study cheap talk by firms and responses by their consumers, focusing on unverifiable promises of charitable donations on eBay during 2005–2006. Cheap talk listings have lower sales probabilities but sell at higher prices when successful. The negative relationship between cheap talk and sales is concentrated in the months following Hurricane Katrina, a time when verifiable and unverifiable charity listings increased dramatically. Finally, we show that cheap talk sellers have lower quality ratings than those making verifiable donations. Our results suggest that buyers (justifiably) avoid cheap talk listings when credible quality signals are available, thus limiting the extent of cheap talk.
Scope of Project
JEL Classification:
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D12 Consumer Economics: Empirical Analysis
D82 Asymmetric and Private Information; Mechanism Design
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
L15 Information and Product Quality; Standardization and Compatibility
L31 Nonprofit Institutions; NGOs; Social Entrepreneurship
M31 Marketing
D12 Consumer Economics: Empirical Analysis
D82 Asymmetric and Private Information; Mechanism Design
D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
L15 Information and Product Quality; Standardization and Compatibility
L31 Nonprofit Institutions; NGOs; Social Entrepreneurship
M31 Marketing
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