Based on the critical assumption of strategic complementarity, this paper builds a general model to describe and solve the screening problem faced by the monopolist seller of a network good. By applying monotone comparative static tools, we demonstrate that the joint presence of asymmetric...

This paper presents a model of price screening for goods with network effects, by a monopoly seller, and by an entry-deterring monopolist. These products are used in variable quantities by heterogeneous customers, the magnitude of network effects is influenced by gross consumption, rather than...

New technology is usually expensive and it takes time for manufacturers to make the technology more accessible. In the stereo industry, the first Super Audio Compact Disk (SACD) player made by Sony, SCD-1, sold for $5,000 in 1999; in 2002 the cheapest of Sony's new SACD players, SCD-CE775, had a...

This paper examines the dynamic pricing problem of a durable-good monopolist when product quality is endogenous. It is shown that the relationship between the firm's quality choice and the time-inconsistency problem crucially depends on how the unit production cost varies with quality. The...

A modern firm often employs multiple production technologies based on distinct engineering principles, causing non-convexities in the firm's unit cost as a function of product quality. Extending the model of Mussa and Rosen (1978), this paper investigates how a monopolist's product line design...

This paper models individual choices of social groups and the formation of group identity, and examines the conditions with which the group identity reinforces the productivity of individuals. A social group is defined as a network that provides with a market for interactions to its members....

Many commodities are such that the utility they create for individual consumers depends positively on the number of people also consuming these goods. Prominent examples among others are mobile phones, game consoles, and computer software. The customers form a network, where the size of the...

There are a lot of goods which have network externalities. While the number of players who have such a good is small, they may not get enough utility from the goods. That is, players have an incentive to delay their decision, when they purchase the goods with network externalities. Delay causes...

We examine a dynamic, durable goods model. A monopolist faces two types of consumers who value the monopolist’s goods differently. The quality of the good improves over time and an improvement is only valuable to consumers if they have previous improvements. In each period, the monopolist can...

This paper looks at the inter-temporal price discrimination game that arises when a monopolist faces naïve-time-inconsistent consumers. En route to solving this game, we introduce two new solution concepts for dynamic games where some players are time inconsistent. The first solution concept is...