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 US airlines to study the relationship between quality, voice, and market structure. Voice increases when quality deteriorates. This relationship is greater for airlines that operate a large share of flights in a market. Supplemental analyses support a relational contracting role for voice.
Gans, Joshua S., Avi Goldfarb, and Mara Lederman.
"Exit, Tweets, and Loyalty."
American Economic Journal: Microeconomics,
Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
Information and Product Quality; Standardization and Compatibility