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Can Price Discrimination be Bad for Firms and Good for All Consumers? A Theoretical Analysis of Cross-Market Price Constraints with Entry and Product Differentiation

Azar, Ofer H. - Volkswirtschaftliche Fakultät, … - 2002

The article examines a differentiated-products duopoly model where the firms make entry decisions to two markets and … then choose prices. The effects of product differentiation and entry costs are analyzed in two games: with and without … price discrimination between the markets. Allowing price discrimination encourages more entry and tends to reduce prices and …

Persistent link: https://www.econbiz.de/10005836325

Signaling the Strength of a Market Entrant

Janda, Karel - Volkswirtschaftliche Fakultät, … - 2009

in the context of game theoretical models of entry into the industry. As opposed to the majority of literature we … decision of the entrant as a signal of his strength. We show that in the Stackelberg model of market entry for some values of … model may be empirically relevant for industrial organization analysis of the entry of a new supplier to the existing supply …

Persistent link: https://www.econbiz.de/10005105914

Technological Progress in Races for Product Supremacy

Nguyen, Thang - Volkswirtschaftliche Fakultät, … - 2004

How does market organization affect quality innovation efforts and social welfare? Three stochastic dynamic market structures considered are monopoly, duopoly, and social planning. Products can be either linearly or nonlinearly substitutable. The introduction of a step function allows richer...

Persistent link: https://www.econbiz.de/10005835961

Stability analysis in a Bertrand duopoly with different product quality and heterogeneous expectations

Fanti, Luciano; Gori, Luca - Volkswirtschaftliche Fakultät, … - 2011

We study the local stability properties of a duopoly game with price competition, different product quality and heterogeneous expectations. We show that the Nash equilibrium can loose stability through a flip bifurcation when the consumer’s type range increases. This result occurs irrespective...

Persistent link: https://www.econbiz.de/10009294915

Markets with untraceable goods of unknown quality: a market failure exacerbated by globalization

McQuade, Timothy; Salant, Stephen W.; Winfree, Jason - Volkswirtschaftliche Fakultät, … - 2009

In markets for many fruits, vegetables, and an increasing number of imported goods, consumers cannot discern the quality of a product prior to purchase and can never identify its producer. Producing high-quality, safe goods is costly for a firm and raises the collective reputation for quality...

Persistent link: https://www.econbiz.de/10008543804

Information Advantage in Stackelberg Duopoly under Demand Uncertainty

Xu, Jin - Volkswirtschaftliche Fakultät, … - 2007

We consider a Stackelberg model under demand slope uncertainty in an environment where the follower owns information advantage. Specifically, we show that the second mover obtains higher expected profit than the first mover when the leader only knows the prior beliefs and the follower gains the...

Persistent link: https://www.econbiz.de/10005616688

Niche products, generic products, and consumer search

Larson, Nathan - Volkswirtschaftliche Fakultät, … - 2008

We endogenize product differentiation in a model of sequential search with random firm-consumer match value à la Wolinsky (1986) and Anderson and Renault (1999). We focus on a product design choice by which a firm can control the dispersion of consumer valuations for its product; we interpret...

Persistent link: https://www.econbiz.de/10009211231

Signalling Rivalry and Quality Uncertainty in a Duopoly

Bester, Helmut; Demuth, Juri - Volkswirtschaftliche Fakultät, … - 2013

This paper considers price competition in a duopoly with quality uncertainty. The established firm (the `incumbent') offers a quality that is publicly known; the other firm (the `entrant') offers a new good whose quality is not known by some consumers. The incumbent is fully informed about the...

Persistent link: https://www.econbiz.de/10010660825

On the Existence of Quality Measures in Random Utility Models

Szczygielski, Krzysztof; Komisarski, Andrzej - Volkswirtschaftliche Fakultät, … - 2012

Random Utitly Models (RUMs) are a particularly convenient way of modelling product differentiation. In this paper we demonstrate that they can be used to examine the possibilities of creating quality measures from data on prices and sales volumes. We formulate conditions sufficient for the...

Persistent link: https://www.econbiz.de/10011111192

A Two-Stage Duopoly Game with Ethical Labeling and Price Competition when Consumers differ in Preferences

Fanelli, Domenico - Volkswirtschaftliche Fakultät, … - 2008

We study a two-stage duopoly game, where, at the first stage, firms choose if adopting or not a social responsibility label. The firm who adopts the social responsibility label (the ethical firm) has high marginal costs, while the firm who doesn’t adopt it (the standard firm), supports low...

Persistent link: https://www.econbiz.de/10005790459

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