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'A' Business by Any Other Name: Firm Name Choice as a Signal of Firm Quality

Posted: 29 Aug 2010 Last revised: 29 Jun 2015

Ryan C. McDevitt

Fuqua Graduate School of Business - Duke University; Duke Innovation & Entrepreneurship Initiative

Date Written: June 2013

Abstract

This paper considers when a firm's deliberately chosen name can signal meaningful information about its quality, focusing specifically on a setting in which it does: plumbing firms with names that begin with an "A" or a number receive five times more service complaints, on average. In addition, firms use names beginning with an "A" or a number more often in larger markets, and those that do have higher prices. These results reflect consumers' search decisions and extend to online platforms: plumbing firms that advertise on Google receive more complaints, which contradicts prior theoretical predictions but fits the setting considered here.

Keywords: Reputation, Names, Position Auctions

JEL Classification: L10, L14, L15

Suggested Citation

McDevitt, Ryan C., 'A' Business by Any Other Name: Firm Name Choice as a Signal of Firm Quality (June 2013). Available at SSRN: https://ssrn.com/abstract=1667550 or http://dx.doi.org/10.2139/ssrn.1667550

Ryan C. McDevitt (Contact Author)

Fuqua Graduate School of Business - Duke University ( email )

100 Fuqua Dr
Durham, NC 27708
United States

HOME PAGE: http://www.ryanmcdevitt.com

Duke Innovation & Entrepreneurship Initiative ( email )

215 Morris St., Suite 300
Durham, NC 27701
United States

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