In this paper we analyse a setup where consumers are heterogeneous in the perception of environmental quality. The equilibrium is verified in a setting with horizontal and vertical (green) differentiation. Profits are increasing in the misperception of quality, while, the investment in green...

A dynamic Hotelling monopoly model is proposed, with the purpose of characterising the effects of informative and persuasive advertising in a regime of partial market coverage. The two models are solved to show the emergence of a unique saddle-point steady-state equilibrium in both cases. Then,...

This review summarizes the extant debate on the interplay between oligopolistic behavior and policy stimuli in determining firms’ green R&D efforts. It encompasses models based on the representative consumer and discrete choice approaches, under both Cournot and Bertrand competition. It also...

The authors modify the price-setting version of the vertically differentiated duopoly model by Aoki (Effect of Credible Quality Investment with Bertrand and Cournot Competition, 2003) by introducing an extended game in which firms noncooperatively choose the timing of moves at the quality stage....

We modify the price-setting version of the vertically differentiated duopoly model by Aoki (2003) by introducing an extended game in which firms noncooperatively choose the timing of moves at the quality stage. Our results show that there are multiple equilibria in pure strategies, in which...

We model a vertically differentiated duopoly with quantity-setting firms as an extended game in which firms noncooperatively choose the timing of moves at the quality stage, to show that at the subgame perfect equilibrium sequential play obtains, with the low-quality firm taking the leaders role.

We investigate the introduction of a minimum quality standard (MQS) in a vertically differentiated duopoly with an environmental externality. We establish that the MQS bites only if the hedonic component of consumer preferences is sufficiently strong. Then, we illustrate an underlying tradeoff...

We extend the analysis carried out by Valletti (2000) by considering an environmental externality in a vertically differentiated duopoly where firms compete à la Cournot with fixed costs of quality improvement. We show that, if the weight of the external effect is high enough, the resulting...