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Quality certification standards in competitive markets: When consumers and producers (dis)agree

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Author Info
Lapan, Harvey
Moschini, GianCarlo

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Abstract

A quality certification standard in a competitive setting can improve welfare but may affect consumers and producers differently. In a competitive model with quality preferences of the vertical product differentiation type, we find that producers prefer a higher (lower) quality standard than consumers if individual demand functions are log-convex (log-concave).

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File URL: http://www.sciencedirect.com/science/article/B6V84-4W7J0VN-1/2/527f7258d1e7fd0ca7e83dbc56960b69
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Publisher Info
Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 104 (2009)
Issue (Month): 3 (September)
Pages: 144-147
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Handle: RePEc:eee:ecolet:v:104:y:2009:i:3:p:144-147

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Web page: http://www.elsevier.com/locate/ecolet

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Related research
Keywords: Comparative statics Log-concavity Minimum quality standards Quality certification Vertical product differentiation;

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This page was last updated on 2009-12-12.

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