Entry and Welfare in Search Markets
研究消费者搜索模型中进入的福利效应，发现进入成本较低时自由进入对消费者福利和总福利过度，消费者福利与进入成本呈倒U型关系。
The welfare effects of entry are studied in a model of consumer search. Potential entrants differ in quality, with high-quality sellers being more likely to meet consumer needs. Contrary to the standard view in economics that more entry benefits consumers, we find that free entry is excessive for both consumer welfare and total welfare when entry cost is relatively low, and consumer welfare has an inverted-U relationship with entry cost. We explain why these results may arise naturally in search markets due to the search variety and search quality effects of entry, and discuss their business and policy implications.