Many durable goods, particularly in the high technology sector of the economy, experience rapid quality improvement. As a result, replacement is typically due to obsolescence rather than breakdown, and replacement cycles are relatively short. When these goods are vertically differentiated,...

The welfare gain to consumers from the introduction of personal computers is estimated here. A simple model of consumer demand is formulated that uses a slightly modi ed version of standard preferences. The modi cation permits marginal utility, and hence total utility, to be nite when the...

The welfare gain to consumers from the introduction of personal computers is estimated here. A simple model of consumer demand is formulated that uses a slightly modified version of standard preferences. The modification permits marginal utility, and hence total utility, to be finite when the...