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Consumer‐Minded Informational Intermediary and Welfare Losses

Wenji Xu & Kai Hao Yang

RAND Journal of Economics2026https://doi.org/10.1111/1756-2171.70050article
AJG 4ABDC A*
Weight
0.50

Abstract

This article examines the welfare implications of third‐party informational intermediation. A seller sets the price of a product that is sold through an intermediary, who discloses information about the product to consumers. In a model where the intermediary is consumer‐minded—has a payoff that depends on both the seller's revenue and the consumer surplus, we show that total welfare may decrease in the Pareto sense, as the intermediary's consumer‐mindedness increases . Furthermore, we show that consumer‐mindedness emerges endogenously when a revenue‐maximizing intermediary is forward‐looking and the consumer base is increasing in past consumer surplus.

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https://doi.org/https://doi.org/10.1111/1756-2171.70050

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@article{wenji2026,
  title        = {{Consumer‐Minded Informational Intermediary and Welfare Losses}},
  author       = {Wenji Xu & Kai Hao Yang},
  journal      = {RAND Journal of Economics},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/1756-2171.70050},
}

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Consumer‐Minded Informational Intermediary and Welfare Losses

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

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