Many durable products cannot be used without a contingent consumable product, e.g., printers require ink, iPods require songs, razors require blades, etc. For such products, manufacturers may be able to lock in consumers by making their products incompatible with consumables that are produced by...

We construct a dynamic game to model a monopoly of finitely durable goods. The solution concept is Markov-perfect equilibria with general equilibria embedded in every time period. Our model is flexible enough to simultaneously explain or accommodate many commonly observed phenomena or stylized...

We study the optimal levels of advertising and promotion budgets in dynamic markets with brand equity as a mediating variable. To this end, we develop and estimate a state-space model based on the Kalman filter that captures the dynamics of brand equity as influenced by its drivers, such as the...