Anger and regulation

 

Autor(es):
Dubra, Juan ; Di Tella, Rafael
Tipo:
Documento de trabajo
Versión:
Publicado
Resumen:

We study a model where agents experience anger when they see a firm that hasdisplayed insufficient concern for their clients' welfare (altruism) makes high profits.Regulation can increase welfare, for example, through fines (even with no changes inprices). Besides the standard channel (efficiency), regulation affects welfare through 2 channels: (i) regulation calms down existing consumers because a reduction in the proffits of an "unkind" firm increases total welfare by reducing consumer anger; and(ii) individuals who were out of the market when they were angry in the unregulated market, decide to purchase once the firm is regulated.

Año:
2012
Idioma:
Inglés
Temas:
Public relations
Commercial legitimacy
Populism
Institución:
Universidad de Montevideo
Repositorio:
Repositorio Digital de la Universidad de Montevideo
Enlace(s):
https://hdl.handle.net/20.500.12806/1324
Nivel de acceso:
Acceso abierto