In this paper, I investigate the effect warranties have on durable goods markets. Many if not goods that are sold with a warranty are durable goods, thus, it is extremely important to consider the role of warranties in a durable goods setting. This paper analyzes the signaling role of warranties...

We examine time-consistent intertemporal price and quality discrimination by a durable goods monopolist facing a continuum of rational buyers with heterogeneous preferences over product quality. We focus the analysis on the "gap" case, where it is profitable for the monopolist to trade with the...

This paper considers a novel and strategic use of quality as a means for solving the durable-goods time inconsistency problem. It demonstrates how durable-goods producers can exploit the cannibalization of high-quality markets by low-quality goods. Relative to the static product line solution,...

We examine time-consistent intertemporal price-quality discrimination by a durable goods monopolist, when there are a continuum of buyer demand-intensities with respect to product quality, and it is profitable for the monopolist to trade with the marginal buyer-type (i.e., the gap case). We show...

This article considers a durable goods monopolist's choice of price and durability in a setting where durability choice controls the speed with which quality deteriorates. The article derives three main results. First, the price at which old units trade on the secondhand market limits what the...