INCOME, SEARCH, AND THE ECONOMICS OF INFORMATION-THEORY - EMPIRICAL-ANALYSIS

The economics of information framework is employed to derive testable hypotheses relating to income and search in gasoline purchasing. The hypotheses are tested at the level of the individual family using data from a year-long panel covering gasoline purchases. The main finding is that search for lower price is highest for middle income families whose marginal benefits are quite large because of large quantities bought, and whose implicit marginal costs are relatively low. © 1979, Taylor & Francis Group, LLC. All rights reserved.