Equilibrium Dynamics in Semi-Durable Goods Markets
AbstractThis paper studies the dynamics that arise when time-consistent firms produce semi-durable goods and compete with an active secondary market. The paper constructs a tractable model that incorporates key elements in generating supply-side dynarnics. Thc tractability of thc model is achicvcd by specifying a linear-quadratic structurel which allows fOI a dosed-form sollltion to the 1,·farkov-perfect equilibrium and a complete characterization of its dynamics. The theory predicts a number of empirically-testable implications for the behavior of lnices and sales and their stochastic properties. Several implications are in line with availablc empirical evidence.
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Semi-durability; Secondary markets; imperfect competion; Time consistency; equilibrium dynamics;
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- Adda, JC, 2000.
"Balladurette and Juppette: A discrete analysis of scrapping subsidies,"
Open Access publications from University College London
http://discovery.ucl.ac.u, University College London.
- Jerome Adda & Russell Cooper, 2000. "Balladurette and Juppette: A Discrete Analysis of Scrapping Subsidies," Journal of Political Economy, University of Chicago Press, vol. 108(4), pages 778-806, August.
- Jerome Adda & Russell Cooper, 1997. "Balladurette and Juppette: A Discrete Analysis of Scrapping Subsidies," NBER Working Papers 6048, National Bureau of Economic Research, Inc.
- Adda, Jérôme & Cooper, Russell W., 1997. "Balladurette and jupette: a discrete analysis of scrapping subsidies," CEPREMAP Working Papers (Couverture Orange) 9711, CEPREMAP.
- Jerome Adda & Russell Cooper, 1997. "Balladurette and Juppette: A Discrete Analysis of Scrapping Subsidies," Papers 0076, Boston University - Industry Studies Programme.
- Igal Hendel & Alessandro Lizzeri, 1999. "Interfering with Secondary Markets," RAND Journal of Economics, The RAND Corporation, vol. 30(1), pages 1-21, Spring.
- Jerome Adda & Russell Cooper, 2000. "The Dynamics of Car Sales: A Discrete Choice Approach," NBER Working Papers 7785, National Bureau of Economic Research, Inc.
- Chen, Jiawei & Esteban, Susanna & Shum, Matthew, 2008. "Demand and supply estimation biases due to omission of durability," Journal of Econometrics, Elsevier, vol. 147(2), pages 247-257, December.
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