Abstract: The steady growth of e-commerce has led to a surge in products being returned after purchase. We extend the seminal consumer search paper by Wolinsky (1986) and analyze product returns as resulting from a trade-off between the social waste of returns and the search efficiency arising from the relative ease to assess one’s value for a good after purchase compared to brick-and-mortar shopping. The model gives clear predictions when consumers inspect before or after purchase in terms of the social costs and benefits of product returns. We compare these market outcomes with what is socially optimal and find intuitive regulatory prescriptions for improving market efficiency and demonstrate how other natural, but ill-formed policies can harm consumers. Keywords: product returns; consumer search; search efficiencies, product matches JEL codes: D40, D83, L1