José M. Usategui () (The University of the Basque Country)
Abstract
In a context where demand for the services of a durable good changes over time, and this change may be uncertain, the paper shows that social welfare may be higher when the monopolist seller can commit to any future price level she wishes than when she cannot. Moreover, the equilibrium under a monopolist with commitment power may Pareto-dominate the equilibrium under a monopolist without commitment ability. These results affect the desired regulation of a durable goods monopolist in this context.
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Publisher Info
Paper provided by University of the Basque Country - Department of Foundations of Economic Analysis II in its series DFAEII Working Papers with number
200605.
Length: Date of creation: 01 Jan 2006 Date of revision:
11 Jan 2008 Publication status: Published in The Manchester School (2007), 75(5), 569-579. Handle: RePEc:ehu:dfaeii:200605
Order Information: Postal: Dpto. de Fundamentos del Análisis Económico II, Facultad de CC. Económicas y Empresariales, Universidad del País Vasco, Avda. Lehendakari Aguirre 83, 48015 Bilbao, Spain Email:
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