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Vaporware

Author

Listed:
  • Jay Pil Choi
  • Eirik Gaard Kristiansen
  • Jae Nahm

Abstract

It is a widely adopted practice for firms to announce new products well in advance of actual market availability, especially in the computer industry. In this article, a firm makes pre-announcements on its product, which are "cheap talk." We develop a reputation model of "vaporware" where the product pre-announcement can partially convey information about the product's quality. We discuss its implications for social welfare. Copyright (2010) by the Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.

Suggested Citation

  • Jay Pil Choi & Eirik Gaard Kristiansen & Jae Nahm, 2010. "Vaporware," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 51(3), pages 653-669, August.
    • Handle: RePEc:ier:iecrev:v:51:y:2010:i:3:p:653-669
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