Influencer marketing is a large and growing but mostly unregulated industry. The paper presented in this Mannheim Virtual IO Seminar documents the existence and study cartels of influencers. Using a novel dataset of Instagram influencer cartels, the authors confirm that the cartels increase engagement as intended. But they also show that engagement from non-specific cartels is of lower quality, whereas engagement from a topic-specific cartel may be as good as natural engagement. The authors then build a theoretical model to understand the behavior and welfare implications of influencer cartels. While influencer cartels may sometimes improve welfare by mitigating the free-rider problem, they can also overshoot and create low-quality engagement. The problem of fake engagement is substantially worse if the advertising market rewards engagement quantity. Therefore topic-specific cartels may sometimes be welfare-improving, whereas typical non-specific cartels hurt everyone.

Speaker

Marit Hinnosaar

University of Nottingham, United Kingdom

The seminars are held on ZOOM. Register with the external registration form to receive reminders, updates, and ZOOM Meeting ID information via e-mail. Seminar presentations are scheduled to last a total of 75 minutes (60 minutes presentations plus 15 minutes Q&A).

Date

06.05.2021 | 15:00 - 16:15 (CET)

Event Location

Online


Department
Category

Contact

Head of Junior Research Group