In this paper, we consider an incumbent firm facing potential entry in a vertical differentiation model a la Mussa and Rosen where consumers differ only by their intensity of preference for quality. We ask whether the incumbent firm has the incentive to adopt a multi-product strategy in order to...

The note explores a vertical differentiation model with continuous non-uniform consumers' distribution. First some results concerning the finiteness property obtained with uniform consumers' distribution are generalized. Second we prove an existence result of price equilibrium when the...