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Oligopoly Pricing With Information and Search Frictions
We study a market where consumers search both extensively and intensively for match information from a finite number of sellers. Consumers choose to acquire more information in earlier visits and become less demanding in later visits if earlier searches are not fruitful. We establish existence of a unique pricing equilibrium in an oligopoly with active search and show the equilibrium price decreases with the number of sellers as in extensive search models.