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The Relationship between Models of Horizontal and Vertical Differentiation

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  • Anglin, Paul M

Abstract

This paper shows how to derive the income and substitution effects of a price change in a differentiated goods model. In the process of doing so, the author shows how to convert a model of a vertically differentiated market into one of horizontally differentiation by constructing two market-specific functions. One of these functions would represent the acknowledged ranking of types if the market were vertically differentiated; the other is a simple function representing the disutility associated with consuming a non-ideal type. Copyright 1992 by Blackwell Publishing Ltd and the Board of Trustees of the Bulletin of Economic Research

Suggested Citation

  • Anglin, Paul M, 1992. "The Relationship between Models of Horizontal and Vertical Differentiation," Bulletin of Economic Research, Wiley Blackwell, vol. 44(1), pages 1-20, January.
    • Handle: RePEc:bla:buecrs:v:44:y:1992:i:1:p:1-20
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    Cited by:

    1. Magdalena Klimczuk-Kochanska, 2016. "The Role of the Soft Innovation in the Research of Low-Tech Sectors on the Example of Food Industry (Rola innowacji miekkich w badaniach innowacyjnosci przedsiebiorstw z sektorow niskotechnologicznych," Research Reports, University of Warsaw, Faculty of Management, vol. 2(22), pages 23-32.
    2. Stefan Lutz, 1997. "Vertical product differentiation and entry deterrence," Journal of Economics, Springer, vol. 65(1), pages 79-102, February.
    3. Werner Smolny, 2003. "Determinants of innovation behaviour and investment estimates for west-german manufacturing firms," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 12(5), pages 449-463.
    4. Paul M. Anglin & Yanmin Gao, 2023. "Value of Communication and Social Media: An Equilibrium Theory of Messaging," The Journal of Real Estate Finance and Economics, Springer, vol. 66(4), pages 861-903, May.
    5. Klimczuk-Kochańska, Magdalena, 2016. "Rola innowacji miękkich w badaniach innowacyjności przedsiębiorstw z sektorów niskotechnologicznych na przykładzie sektora spożywczego [The Role of the Soft Innovation in the Research of Low-Tech S," MPRA Paper 84757, University Library of Munich, Germany.

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