Increasingly sophisticated machinery, short product life-cycles, and demanding user requirements have increased competition in the machine tool market. Because all machine tool companies have limited resources, they must seek competitive advantages. Strategic collaborations have become...

The aim of this study is to investigate how network effects affect the quality and price decisions of firms in a vertically differentiated market. As network effects increase, high-quality producers tend to raise quality while low-quality producers lower it. The degree of product differentiation...