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This paper considers price competition in a duopoly with quality uncertainty. The established firm (the `incumbent … consumers. The incumbent is fully informed about the entrant's quality. This leads to price signalling rivalry because the …
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In this paper we extend the model of vertical product differentiation to also consider information disparities about the extent of quality differences. Equilibrium prices turn out to depend not only on the share of informed consumers but also on uninformed consumers beliefs about quality...
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outcome. -- Quality uncertainty ; Signalling ; Oligopoly … observed by the incumbent and some fraction of informed consumers. This leads to price signalling rivalry between the …
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neither. We show that two types of signalling equilibria are possible. Both are characterised by dispersion and Pareto …
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