Traditional models of consumer choice assume consumers are aware of all products for sale. This assumption is questionable, especially when applied to markets characterized by a high degree of change, such as the personal computer (PC) industry. I present an empirical discrete-choice model of...

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,...

New and old products differ in two respects: quality and newness. Whereas a higher quality of a new product always benefits consumers, the newness itself benefits some consumers, but not others, and for some, it is even a disadvantage. We capture these features in a Hotelling model of...

We analyze the link between entry and Ramp;D spending distribution. We consider a monopolistic competitive market with free entry in which firms can invest in cost-cutting Ramp;D by paying a fixed cost first. For an intermediate level of fixed cost, there is a unique equilibrium in which the...

In this article, we provide a novel measure of product differentiation by observing consumer search behavior directly. We track individual consumers in a price search engine and generate a measure of distance in product space, based on goods surveyed conjointly within individual search episodes....

This paper examines how information on the purchasing patterns of different customer segments can be used to more accurately evaluate the economic impact of mergers. Using a detailed dataset for the leading manufacturers in the US during the late nineties, I evaluate the welfare effects of the...

New and old products differ in two respects: quality and newness. Whereas a higher quality of a new product always benefits consumers, the newness itself benefits some consumers, but not others, and for some, it is even a disadvantage. We capture these features in a Hotelling model of Over-...

This article is a study focusing on an important area of appliances we inevitably use almost daily and which has a tendency of renewal, diversification and quality improvement – that is the television set. There is a discrepancy between the quality of the products on the market and the one...

Theoretical research on self-selection and cannibalization suggests that brand quality may affect consumers' choice of products from a menu of similar offerings. However, few studies have empirically considered the effect of product variety under brand influence. This paper examines the demand...

We analyze the link between entry and R&D spending distribution. We consider a monopolistic competitive market with free entry in which firms can invest in cost-cutting R&D by paying a fixed cost first. For an intermediate level of fixed cost, there is a unique equilibrium in which the market...