Quality indicators: in theory and in fact

TY - JOUR

T1 - Quality indicators

T2 - in theory and in fact

AU - Hjorth-Andersen, Christian

PY - 1991

Y1 - 1991

N2 - In recent literature it has been suggested that consumers need have no knowledge of product quality as a number of quality indicators (or signals) may be used as substitutes. Very little attention has been paid to the empirical verification of these studies. The present paper is devoted to the issue of how well these indicators perform, using market data provided by consumer magazines from 3 countries. The results strongly indicate that price is a poor quality indicator. The paper also presents some evidence which suggests that seller reputation and easily observable characteristics are also poor indicators

AB - In recent literature it has been suggested that consumers need have no knowledge of product quality as a number of quality indicators (or signals) may be used as substitutes. Very little attention has been paid to the empirical verification of these studies. The present paper is devoted to the issue of how well these indicators perform, using market data provided by consumer magazines from 3 countries. The results strongly indicate that price is a poor quality indicator. The paper also presents some evidence which suggests that seller reputation and easily observable characteristics are also poor indicators

U2 - 10.1016/0014-2921(91)90014-A

DO - 10.1016/0014-2921(91)90014-A

M3 - Journal article

SN - 0014-2921

VL - 35

SP - 1491

EP - 1505

JO - European Economic Review

JF - European Economic Review

IS - 8

ER -