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Expert product reviews and conflict of interest
Author(s) -
Hamami Tom,
Bailey James
Publication year - 2021
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.3221
Subject(s) - product (mathematics) , revenue , conflict of interest , cheap talk , quality (philosophy) , economics , microeconomics , inflation (cosmology) , marketing , business , industrial organization , accounting , finance , philosophy , physics , geometry , mathematics , epistemology , theoretical physics
Many firms that produce expert product reviews benefit from increased sales of the products they review, resulting in a conflict of interest. We evaluate expert product reviews from a video game magazine owned by a game retailer. We find evidence of review inflation for lower‐quality games and in periods shortly following the release of a game's corresponding hardware. These results are consistent with theoretical predictions for a firm that optimizes the trade‐off between sales revenue and the reputational costs associated with biasing reviews.