Buyer confusion and Prices
Economic theory suggests that more choice is better. Indeed, companies around the world have been offering more variety in their product and services, in order to cater to different individuals with different preferences. People can choose a smartphone based on 30 different attributes, with each of these 30 attributes having subclassifications. Barry Schwartz in his book "The Paradox of choice" presents a list of products that he came across in the market in the US. He says that there are 285 varieties of cookies, 230 soup offerings, 175 salad dressings, 275 varieties of cereal, 75 varieties of iced teas, 15 flavors of bottled water in the food section. In the pharmaceutical section, he found 61 varieties of suntan and sunblock, 80 different pain relievers, 40 options for toothpaste, 116 types of skin cream. In the electronics section, he found 6,512,000 possibilities of different stereo systems, 110 different televisions, and 85 different telephones excluding cel...