Uncertainty quality, product variety and price competition
AbstractThis paper analyses price competition under product differentiation when goods are defined in a two dimensional characteristic space, and consumers do not know which firm sells which quality. Equilibrium prices consist of two additive terms, which balance consumers' relative valuation of goods' expected quality and consumers' preferences for variety. However the relative importance of these terms differ under vertical and horizontal dominance.
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Bibliographic InfoPaper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2008036.
Date of creation: 01 Jun 2008
Date of revision:
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product differentiation; variety; quality; uncertainty;
Other versions of this item:
- Jean J., GABSZEWICZ & Joana, RESENDE, 2008. "Uncertainty quality, product variety and price competition," Discussion Papers (ECON - DÃ©partement des Sciences Economiques) 2008027, Université catholique de Louvain, Département des Sciences Economiques.
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-11-25 (All new papers)
- NEP-COM-2008-11-25 (Industrial Competition)
- NEP-MIC-2008-11-25 (Microeconomics)
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