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Monopolistic Competition and Preference Diversity

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Author Info
Deneckere, Raymond J
Rothschild, Michael

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Abstract

This paper presents a general model of the demand for differentiated products which has as special cases two popular models used to analyze welfare and competition in monopolistically competitive markets: the model of spatial competition and the symmetric aggregate benefit function approach. The authors model is especially attractive because it starts from economic primitives: a specification of the set of possible individual preference patterns. It shows how specific properties of the distribution of preferences translate into properties of aggregate demand. This allows the authors to understand the relationship between the distribution of preferences and the degree to which the market introduces biases in product selection. Copyright 1992 by The Review of Economic Studies Limited.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of Economic Studies.

Volume (Year): 59 (1992)
Issue (Month): 2 (April)
Pages: 361-73
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Handle: RePEc:bla:restud:v:59:y:1992:i:2:p:361-73

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Sattinger, Michael, 1984. "Value of an Additional Firm in Monopolistic Competition," Review of Economic Studies, Blackwell Publishing, vol. 51(2), pages 321-32, April. [Downloadable!] (restricted)
  2. Steven C. Salop, 1979. "Monopolistic Competition with Outside Goods," Bell Journal of Economics, The RAND Corporation, vol. 10(1), pages 141-156, Spring. [Downloadable!] (restricted)
  3. Perloff, Jeffrey M & Salop, Steven C, 1985. "Equilibrium with Product Differentiation," Review of Economic Studies, Blackwell Publishing, vol. 52(1), pages 107-20, January. [Downloadable!] (restricted)
  4. Spence, Michael, 1976. "Product Selection, Fixed Costs, and Monopolistic Competition," Review of Economic Studies, Blackwell Publishing, vol. 43(2), pages 217-35, June. [Downloadable!] (restricted)
  5. Raymond Deneckere & Carl Davidson, 1985. "Incentives to Form Coalitions with Bertrand Competition," RAND Journal of Economics, The RAND Corporation, vol. 16(4), pages 473-486, Winter. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Clarissa Yeap, 2006. "The Production Decisions of Large Competitors: Detecting Cost Advantages and Strategic Behavior in Restaurants," Working Papers 06-19, Center for Economic Studies, U.S. Census Bureau. [Downloadable!]
  2. Heritiana Ranaivoson, 2005. "The economic analysis of product diversity," Cahiers de la Maison des Sciences Economiques r05083, Université Panthéon-Sorbonne (Paris 1). [Downloadable!]
  3. Aurora García, Nikolaos Georgantzís, Vicente Orts Ríos, & José C. Pernías, . "Profile Learning by Strategic Workers in Wage-Setting Duopsony," Computing in Economics and Finance 1997 149, Society for Computational Economics. [Downloadable!]
  4. Simon P. Anderson & Regis Renault, 1999. "Pricing, product diversity, and search costs: a Bertrand-Chamberlin-Diamond model," Virginia Economics Online Papers 335, University of Virginia, Department of Economics. [Downloadable!]
    Other versions:
  5. Andre dePalma & Karim Kilani, 2000. "The Optimal of Provision of Products with Income Effects," Econometric Society World Congress 2000 Contributed Papers 1299, Econometric Society. [Downloadable!]
  6. Simon P. Anderston & Andre de Palma, 1991. "Multiproduct Firms: A Nested Logit Approach," Discussion Papers 973, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  7. V. Bhaskar & Ted To, 2002. "Is Perfect Price Discrimination Really Efficient? An Analysis of Free Entry," Economics Discussion Papers 537, University of Essex, Department of Economics. [Downloadable!]
    Other versions:
  8. V. Bhaskar & Ted To, 2000. "Is Perfect Price Discrimination Really Efficient? An Analysis of Free Entry Equilibria," Industrial Organization 0004011, EconWPA. [Downloadable!]
  9. Simon P. Anderson & Andre de Palma, 1989. "The Logit as a Model of Product Differentiation: Further Results and Extensions," Discussion Papers 913, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  10. Jeffrey R. Campbell, 2005. "Competition in Large Markets," NBER Working Papers 11847, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  11. Reynald-Alexandre Laurent, 2006. "Differentiated duopoly with "Elimination by Aspects"," PSE Working Papers 2006-17, PSE (Ecole normale supérieure). [Downloadable!]
  12. Christou, Charalambos & Vettas, Nikolaos, 2003. "Informative Advertising and Product Differentiation," CEPR Discussion Papers 3953, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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