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Benjamin Shiller

Assistant Professor — Department of Economics — Brandeis University


Working Papers

Optimized Sticky Targeted Pricing [Paper]
Emerging tracking data allow precise predictions of individuals' reservation values. However, firms are reluctant to conspicuously implement personalized pricing because of concerns about consumer reprisals. This paper examines a concealed form of personalized pricing. Specifically, firms sometimes tailor the "posted" price for the arriving consumer but privately commit to change price infrequently, making it nearly indistinguishable from traditional dynamic pricing. Empirically, I find this strategy raises profits for medium and low popularity products. I then document similar pricing patterns at Amazon, suggesting it may already be deployed and thus is a feature to include when modeling firm behavior in online markets.
Does Amazon Exercise its Market Power? Evidence from Toys R Us (with Leshui He and Imke Reimers) [Paper]
Since its founding, Amazon has established a reputation for being consumer friendly by consistently offering low prices. However, recent antitrust concerns about dominant online platforms have revived questions about whether Amazon uses its market share to exploit consumers. Using the sudden U.S. exit of Toys R Us as a natural experiment, we find that Amazon's prices increased by almost 5% in the wake of the exit, with larger increases for popular products most likely stocked by Toys R Us. Thus, despite Amazon's long-standing reputation for low prices, it may exploit increases in market power as traditional retailers cease operating.
Are Coarse Ratings Fine? Application to Crashworthiness Ratings (with Siqi Liu and Bhoomija Ranjan) [Paper]
We investigate the impact of intentionally coarsening ratings in the context of automobile safety ratings. First, we construct a novel univariate continuous crashworthiness rating from crash test measurements and observed fatality rates. We then estimate a random coefficient model of vehicle demand under status quo coarse ratings and simulate outcomes under counterfactual continuous ratings. We find that consumers alter vehicle choices, thereby reducing fatalities by 7.4% --- implying 1850 fewer US fatalities annually. Finally, we explore whether incentives to produce crashworthy vehicles are reduced enough to offset benefits of finer information. We conclude that a continuous rating format would reduce fatalities.

Publications

Approximating Purchase Propensities and Reservation Prices from Broad Consumer Tracking International Economic Review, 2020 [Paper]
Previously circulated under the title: "First-Degree Price Discrimination Using Big Data"
Policy impact: Cited by White House Policy Report
Data Supplement: Read Me , Replication Data
The Impacts of Telematics on Competition and Consumer Behavior in Insurance (with Imke Reimers) The Journal of Law and Economics, 2019 [Paper]
The Effect of Ad Blocking on Website Traffic and Quality (with Joel Waldfogel and Johnny Ryan) The RAND Journal of Economics, 2018 [Paper]
Previously circulated under the title: "Will Ad Blocking Break the Internet?"
Press Coverage: VOX EU, Business Insider
Digital Distribution and the Prohibition of Resale Markets for Information Goods Quantitative Marketing and Economics, 2013 [Paper]
The Challenge of Revenue Sharing with Bundled Pricing: An Application to Digital Music (with Joel Waldfogel) Economic Inquiry, 2013 [Paper]
Music for a Song: An Empirical Look at Uniform Pricing and Its Alternatives (with Joel Waldfogel) The Journal of Industrial Economics, 2011 [Paper]
Press Coverage: The Economist, VOX EU