Edited by Ruth Towse and Trilce Navarrete Hernández
Chapter 16: Criticism
Criticism (or reviews) of products can be rationalised in terms of the economics of information. Cultural products are experiences goods which are also subject to uniqueness. Therefore consumers may make sub-optimal choices owing to lack of information. If consumers respond to critical information then their choices may change, with consequent impacts on the earnings and production decisions of cultural producers. There are many studies which examine the impact of criticism on consumption/demand. Currently there is an explosion of interest in this area, owing to disruptive digital innovations which increase the volume and velocity of circulation of information. The obvious hypothesis that good results from criticism lead to increased sales is still largely confirmed. Digital disruption increases the need to overcome the ‘noise’ problem in the signal from the plethora of sources. The solution to this is typically to rely on reputation capital, in the information signal, from the critical content such as winners and nominations in prizes and awards, or from established, named critics whose view is valued. The critic may also operate as the ‘voice’ of the consumer which can be welfare-enhancing as many consumers are locked in by loyalty.
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