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Choix des produits : concurrence en qualité et en variété

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  • Damien Neven
  • Jacques-François Thisse

Abstract

A duopoly model encompassing both horizontal and vertical differentiation is analysed. We seek subgame perfect Nash equilibria in a game where firms choose, first, the horizontal (variety) and the vertical (quality) characteristics of their product and, then, compete in prices. We show that, whatever the products' characteristics, a price equilibrium exists. In the product selection stage, firms choose maximum differentiation along one of the characteristics and minimum differentiation along the other. When the quality range is broad enough relative to the variety range, firms choose the same variety but maximise differentiation in quality. Otherwise, they both choose the maximum quality but maximise their difference in terms of variety.

Suggested Citation

  • Damien Neven & Jacques-François Thisse, 1989. "Choix des produits : concurrence en qualité et en variété," Annals of Economics and Statistics, GENES, issue 15-16, pages 85-112.
    • Handle: RePEc:adr:anecst:y:1989:i:15-16:p:85-112
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    Cited by:

    1. S. Duvaleix-Tréguer & A. Hammoudi & L. Rouached & L.G. Soler, 2012. "Firms' responses to nutritional policies," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 39(5), pages 843-877, December.
    2. Audrey Boilley, 2013. "Duopoly Competition and Regulation in a Two-Sided Health Care Insurance Market with Product Differentiation," Working Papers 2013-02, CRESE.

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