On production costs in vertical differentiation models
AbstractWe analyze the effects of the introduction of a unit production cost in a vertical differentiation model with fixed costs of quality improvement: For a low (high) unit cost, a rise in cost reduces (increases) product differentiation and prices.
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Bibliographic InfoArticle provided by Elsevier in its journal Economics Letters.
Volume (Year): 109 (2010)
Issue (Month): 3 (December)
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Web page: http://www.elsevier.com/locate/ecolet
Fixed cost Variable cost Product quality Vertical differentiation;
Other versions of this item:
- Dorothée Brécard, 2009. "On production costs in vertical differentiation models," Working Papers hal-00421171, HAL.
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