Companies with market power occasionally engage in intentional quality reduction of a portion of their output as a means of offering two qualities of goods for the purpose of price discrimination, even absent a cost saving. This paper provides an exact characterization in terms of marginal...

The terrorist attacks of September 11 have challenged the view that the U.S. economy is on the brink of recovery. This article discusses the effects of the attacks on real GDP taking the Kiel InstituteÂ’s forecast of September 10 as the baseline scenario. The focus is on assessing the direct...

If a product has two dimensions of quality, one observable and one not, a firm can use observable quality as a signal of unobservable quality. The correlation between consumers' valuation of high quality in each dimension is a key determinant of the feasibility of such signaling. A firm may use...

As consumer demand for organic food grows, organic certification is increasingly promoted in many developing countries. Organic products earn a premium price on the market compared to conventional varieties. Hence, organic production is often seen as a valuable alternative for developing...

As consumers’ demand for organic products and especially organic food grows, organic certification for tropical fruit is increasingly promoted in many developing countries. Certified organic pineapple exports only started taking off after 2005 and are rapidly increasing. The organic and...

The authors examine the timing and quality of product introduction in an R&D stopping game, where they allow for horizontal and vertical differentiation in the product market. They observe that discontinuous changes in introduction dates can occur as firms' abilities as researchers change....

Network-effects may lead to imperfect competition and may therefore make a Strategie trade policy attractive for a country exporting network goods. I analyze the implications of Strategie trade policy in a model of horizontal produetdifferentiation with network effects. Within this framework,...

This paper sheds some light on the possible implications of compensations which are paid for the maintenance of an environmental stock. It shows that serious complications can arise if the resource-owner can vary the compensation price. In that case, extraction-driven stock preservation policies...