We present a model of dynamic monopoly pricing for a good that displaysnetwork effects. In contrast with the standard notion of arational-expectations equilibrium, we model consumers as boundedlyrational, and unable either to pay immediate attention to each pricechange, or to make accurate...

A modern firm often employs multiple production technologies based on distinct engineering principles, causing non-convexities in the firm s unit cost as a function of product quality. Extending the model of Mussa and Rosen (1978), this paper investigates how a monopolist s productline design...

We revisit the issue of product line design by a monopolist andextend the model of Mussa and Rosen (1978) in two ways. First, weconsider the case in which the unit cost is a nonconvex function ofproduct quality. We show that the firm does not offer those qualitieswhere the unit cost is linear or...

We present a model of dynamic monopoly pricing for a good that displays network effects. In contrast with the standard notion of a rational-expectations equilibrium, we model consumers as boundedly rational, and unable either to pay immediate attention to each price change, or to make accurate...