Reward and Risk in the Influencer Economy: Analyzing Collaborative Product Decisions and Risk Mitigation Strategies

The influencer economy has evolved into a large and rapidly expanding yet increasingly risky industry. From the perspective of its impact on consumers' purchasing decisions, we categorize existing influencers into two categories and investigate the equilibrium pricing and quality of a brand manufacturer launching a collaborative product with an influencer. We further incorporate the brand's risk-averse behavior and the influencer's endogenous and exogenous risk mitigation efforts into the analyt