Abstract: We develop an exchange economy model where investors choose among differentiated information products that vary along two dimensions: quality and non-quality attributes such as branding or presentation. Producers invest strategically to improve both dimensions. Our analysis shows that as competition intensifies—either through lower costs of enhancing quality or diminished investor preference for non-quality features—information quality improves and

disagreement across investors declines. Despite these gains, the equilibrium allocation is inefficient. Producers engage in excessive differentiation along non-quality dimensions to secure market power, which leads to underinvestment in information quality. This distortion generates an oversupply of variety but a suboptimal level of high-quality information, with important implications for asset prices and welfare.

Bio: Wei Wang is an assistant professor at the Chinese University of Hong Kong, Shenzhen. He earned his Ph.D. in Finance from Indiana University and holds a Master’s in Economics from Tsinghua University and a Bachelor’s in Economics and Applied Mathematics from Wuhan University. Wei’s research area is asset pricing, specializing in heterogeneous belief, textual analysis, and cryptocurrency.