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Why Mixed Qualities May Not Survive at Equilibrium : The Case of Vertical Product Differentiation

Burlakov, Georgi - 2016

In the classical literature on vertical differentiation, goods are assumed to be single products each offered by a different firm and consumed separately one from another. This paper departs from the standard setup and explores the price competition in a vertically differentiated market where a...

Persistent link: https://www.econbiz.de/10012983463

Beyond the uniform distribution : equilibrium prices and qualities in a vertically differentiated duopoly

Benassi, Corrado; Chirco, Alessandra; Colombo, Caterina - 2015

The paper proves the existence of a subgame perfect Nash equilibrium in a vertically differentiated duopoly with …

Persistent link: https://www.econbiz.de/10011713762

Dynamic entry in vertically differentiated markets

Auer, Raphael A.; Sauré, Philip - 2016

We develop a model of vertical innovation in which firms incur a market entry cost and choose a unique level of quality. Once established, firms compete for market shares, selling to consumers with heterogeneous tastes for quality. The equilibrium of the pricing game exists and is unique within...

Persistent link: https://www.econbiz.de/10011547909

Competition between Vertically Differentiated Platforms

Zennyo, Yusuke - 2019

This paper investigates the competition between vertically differentiated platforms in two-sided markets. We assume the presence of two competing platforms producing either higher- or lower-quality devices for consumers. Each platform decides the price of its hardware device for consumers and...

Persistent link: https://www.econbiz.de/10012904109

Vertical Differentiation in Monetary Search-Theorectic Models-Revisited

Chang, Chia-Ying - 2010

In this article, the discussion on quality levels in the monetary search theoretical model is extended. By having quality levels endogenously determined, we found that whether money holders have quality preferences is crucial to the results. While the effect of the fraction of money on quality...

Persistent link: https://www.econbiz.de/10013149151

Union structure and product quality differentiation

Meccheri, Nicola; Vergari, Cecilia - 2024

This paper investigates the issue of how alternative unionization structures in labour markets affect the choice of product quality differentiation by firms in product markets, and how this determines relative welfare outcomes of different union structures. In the presence of decentralized wage...

Persistent link: https://www.econbiz.de/10014464640

Bidimensional Vertical Differentiation

Garella, Paolo G.; Lambertini, Luca - 2012

quality. Standard models maintain that: (i) in a duopoly there will be a quality leader no matter whether the product can …

Persistent link: https://www.econbiz.de/10014171453

Finding endogenous market coverage equilibria in vertically differentiated markets under quality dependent costs

Pires, Cesaltina; Jorge, Sílvia; Catalão‐Lopes, … - 2022

valuation is low, the equilibrium involves quality choices that lead to a partial coverage duopoly. For slightly higher lowest … valuation levels, firms choose qualities in the interior of the region where a full coverage duopoly with a corner solution … frontier between the interior and the corner full coverage duopoly regions. Finally, for high lowest quality valuations the …

Persistent link: https://www.econbiz.de/10014237565

Price Competition with Information Disparities in a Vertically Differentiated Duopoly

Cavaliere, Alberto - 2004

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...

Persistent link: https://www.econbiz.de/10014072462

Vertical Product Differentiation and Entry Deterrence

Lutz, Stefan - 2003

This paper studies how the existence of a potential entrant influences an incumbent's choice of quality in a model of vertical product differentiation and entry. Both firms face fixed set-up costs and quality-dependent costs of production and compete on quality and price. With identical...

Persistent link: https://www.econbiz.de/10014097491

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