Exit, Tweets, and Loyalty
82 Pages Posted: 24 Dec 2016 Last revised: 25 Feb 2020
Date Written: January 3, 2020
Hirschman’s Exit, Voice, and Loyalty highlights the role of “voice” when individuals confront an unexpected deterioration in quality. Yet, voice has received little attention. To motivate our empirical analysis, we develop a simple model of voice as the equilibrium of a relational contract between customers and firms. We use data on 4 million tweets to or about U.S. airlines to study the relationship between quality, voice, and market structure. Voice increases when quality deteriorates. This relationship is greater for airlines which operate a large share of flights in a market. Supplemental analyses support a relational contracting role for voice.
Keywords: exit voice and loyalty, complaints, airlines, Twitter, social media
JEL Classification: L1, D4, L86
Suggested Citation: Suggested Citation