Sergey Turlo
Postdoctoral Researcher (Quantitative Marketing)
Contact:
Chair of Quantitative Marketing
Faculty of Economics and Business
Goethe University Frankfurt
Theodor-W.-Adorno-Platz 4
60323 Frankfurt, Germany
turlo[at]marketing.uni-frankfurt.de
+49 (0)69 798 34648
General Information
Research Interests
Quantitative marketing, economics of information, choice modeling, consumer online reviews, firm pricing, labeling, industrial organization
Working Papers
Discrete Choice in Marketing through the Lens of Rational Inattention (2023, joint with Matteo Fina, Arash Laghaie, Johannes Kasinger, and Thomas Otter)
Models derived from random utility theory represent the work-horse methods to learn about consumer preferences from discrete choice data. However, a large body of literature documents various behavioral patterns that cannot be captured by basic random utility models and require different non-unified adjustments to accommodate these patterns. In this article, we suggest how to develop an empirical rational inattention model for the analysis of discrete choice among multiple alternatives described along multiple attributes, as encountered in prototypical discrete choice experiments and choice-based-conjoint analysis in marketing and economics. We then illustrate how this model naturally motivates stylized empirical results that are hard to reconcile from a random utility perspective. Finally, we contrast the proposed approach to extant empirical work that builds on rational inattention.
Persuasion through Ordered Information (2019)
I consider a model of costly information acquisition where the order in which a receiver can learn about the various characteristics of a multi-attribute offering is determined by a sender who wants to persuade the receiver to accept the offering. I characterize optimal attribute orders when the receiver either learns simultaneously or sequentially, and attributes are heterogeneous either with respect to learning costs or dispersions. Further, I obtain clear-cut conditions on when there is an over- and under-provision of information and show that the number of attributes learned in equilibrium is non-monotonic in the receiver's outside option. Moreover, this paper highlights the role of the distribution of costs and dispersions across attributes as a key determinant for the sender's ability to persuade. Lastly, I discuss various applications for this form of persuasion such as the choice of obfuscation and the regulation of information provision.
Regulating Cancellation Rights with Consumer Experimentation (2022, joint with Florian Hoffmann and Roman Inderst)
Embedding consumer experimentation with a product or service into a market environment, we find that unregulated contracts induce too few returns or cancellations, as they do not internalize a pecuniary externality on other firms in the market. Forcing firms to let consumers learn longer by imposing a commonly observed statutory minimum cancellation or refund period is socially efficient only when firms appropriate much of the market surplus, while it backfires otherwise. Interestingly, cancellation rights are a poor predictor of competition, as in the unregulated outcome firms grant particularly generous rights when competition is neither too low nor too high.
Mergers, Welfare, and Bargaining Power (2019)
I study the impact of upstream mergers on prices in a model of vertically related markets where input prices are determined by negotiations. I show how the impact of bargaining power on price changes caused by a merger can be non-monotonic. This analysis has two implications. First, when conducting a merger simulation in a vertically related industry it is important to estimate bargaining weights. Second, the efficiency gains that are necessary for a merger to be welfare increasing are rather small when either sellers have little bargaining power or when buyers have little bargaining power and there are large differences in upstream efficiency. The identified non-monotonicity is more general and can be applied to any bargaining context where a buyer's disagreement payoff varies.
Work in Progress
Pricing of Add-On Products with Rationally Inattentive Consumers (2023, joint with Dominik Naeher)
Consumer Reviews and Survival of New Firms (2023, joint with Keyvan Dehmamy)
Rational Inattention and Sequential Search
Teaching Experience
Application of Theory in Marketing (2020 - 2023, Advanced Bachelor & Master Course)
In this course, students will learn how theoretical models can support business decision making and research in marketing. First, they will learn about the role of theory in marketing as a science and how theories are constructed. Commonly used mathematical theories from marketing and economics will be introduced. Then, they will learn how theories can be tested in empirical research through the formulation of hypotheses and the operationalization of theoretical concepts. This is followed by making explicit how theory provides practitioners with variables and assumptions that require attention in business cases, reveals relevant economic mechanisms, and allows to conduct counterfactual analyses. During the course, examples are provided from marketing topics such as consumer choice and advertising. The focus of this course lies on the application of existing theories rather than the development of own theories. For this reason, students need to do the following in order to pass the course: 1. They will write a research proposal (term paper) that suggests how a theory can be tested. The theory will be based on a paper that obtains its results through the application of game theory. 2. They will give a group presentation where they apply a theory to a real world case where they use the theory either to explain observed behavior in the market or to make recommendations for a firm or a regulatory body.