Quality certification standards in competitive markets: When consumers and producers (dis)agree
A quality certification standard in a competitive setting can improve welfare but may affect consumers and producers differently. In a competitive model with quality preferences of the vertical product differentiation type, we find that producers prefer a higher (lower) quality standard than consumers if individual demand functions are log-convex (log-concave).
Year of publication: |
2009
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Authors: | Lapan, Harvey ; Moschini, GianCarlo |
Published in: |
Economics Letters. - Elsevier, ISSN 0165-1765. - Vol. 104.2009, 3, p. 144-147
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Publisher: |
Elsevier |
Keywords: | Comparative statics Log-concavity Minimum quality standards Quality certification Vertical product differentiation |
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