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The Learning Curve and Durable-Goods Production

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  • Atsuo Utaka

    (Osaka University)

Abstract

We investigate the effect of a learning curve on the production of durable goods by examining a durable-goods monopolist in a two-period model. If the monopolist faces a learning curve, the model shows that the equilibrium quantity of the first- (second-) period products will be smaller (larger) than if there were no learning curve. Consequently, in cases where the original production cost is sufficiently large, the presence of a learning curve drives down total profits.

Suggested Citation

  • Atsuo Utaka, 2001. "The Learning Curve and Durable-Goods Production," Economics Bulletin, AccessEcon, vol. 12(5), pages 1-8.
    • Handle: RePEc:ebl:ecbull:eb-01l10004
    as

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    References listed on IDEAS

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    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance

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