Warranties without Commitment to Market Participation
The provision of product warranties when the exit of firms is possible is an example of a more general contracting proble m without full commitment. When firms cannot precommit to future mark et participation, they can exit if continued participation is not profitable, thereby avoiding outstanding warranty obligations. Incentives for market participation come from future profits that depend on future sales. The resulting intertemporal linkage between cohorts of consumers may create multiple, Pareto-ordered equilibria. The possibility of multiple equilibria is examined for alternative market structures as is the government's role in influencing the selection of an equilibrium. Copyright 1993 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Volume (Year): 34 (1993)
Issue (Month): 1 (February)
|Contact details of provider:|| Postal: |
Phone: (215) 898-8487
Fax: (215) 573-2057
Web page: http://www.econ.upenn.edu/ier
More information through EDIRC
|Order Information:|| Web: http://www.blackwellpublishing.com/subs.asp?ref=0020-6598 Email: |
When requesting a correction, please mention this item's handle: RePEc:ier:iecrev:v:34:y:1993:i:1:p:85-100. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley-Blackwell Digital Licensing)or ()
If references are entirely missing, you can add them using this form.