A Theory of Recommendations

• Tác giả: Jean-Michel Benkert, Armin Schmutzler
• Ngôn ngữ: eng
• Ký hiệu phân loại: 340.1 Philosophy and theory of law
• Thông tin xuất bản: 2024
• Bộ sưu tập: Metadata
• ID: 203797

Tóm tắt

This paper investigates the value of recommendations for disseminating economic information, with a focus on frictions resulting from preference heterogeneity. We consider Bayesian expected-payoff maximizers who receive non-strategic recommendations by other consumers. The paper provides conditions under which different consumer types accept these recommendations. Moreover, we assess the overall value of a recommendation system and the determinants of that value. Our analysis highlights the importance of disentangling objective information from subjective preferences when designing value-maximizing recommendation systems.