IDEAS home Printed from https://ideas.repec.org/a/taf/ijecbs/v4y1997i1p21-31.html
   My bibliography  Save this article

Production, Quality and Markets

Author

Listed:
  • Donald George

Abstract

The quality of output is of great concern to firms, consumers and regulators and yet firms' decisions concerning quality receive far less attention from economists than quantity or pricing decisions. There is a substantial management literature on product quality which, to some extent, discusses the costs and benefits of various approaches to product quality, but does not provide a theoretical explanation of the firm's quality decisions. The model presented here incorporates production, quality control, warranty and pricing decisions into the firm's overall (expected) profit maximising behaviour. Both competitive and monopolistic markets are considered.

Suggested Citation

  • Donald George, 1997. "Production, Quality and Markets," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 4(1), pages 21-31.
  • Handle: RePEc:taf:ijecbs:v:4:y:1997:i:1:p:21-31
    DOI: 10.1080/758532191
    as

    Download full text from publisher

    File URL: http://www.tandfonline.com/10.1080/758532191
    Download Restriction: Access to full text is restricted to subscribers.

    File URL: https://libkey.io/10.1080/758532191?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Milgrom, Paul & Roberts, John, 1982. "Limit Pricing and Entry under Incomplete Information: An Equilibrium Analysis," Econometrica, Econometric Society, vol. 50(2), pages 443-459, March.
    2. Milgrom, Paul & Roberts, John, 1986. "Price and Advertising Signals of Product Quality," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 796-821, August.
    3. Walter Y. Oi, 1973. "The Economics of Product Safety," Bell Journal of Economics, The RAND Corporation, vol. 4(1), pages 3-28, Spring.
    4. Geoffrey Heal, 1977. "Guarantees and Risk-Sharing," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 44(3), pages 549-560.
    5. Roland N. McKean, 1970. "Products Liability: Implications of Some Changing Property Rights," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 84(4), pages 611-626.
    6. Kreps, David M. & Wilson, Robert, 1982. "Reputation and imperfect information," Journal of Economic Theory, Elsevier, vol. 27(2), pages 253-279, August.
    7. Klein, Benjamin & Leffler, Keith B, 1981. "The Role of Market Forces in Assuring Contractual Performance," Journal of Political Economy, University of Chicago Press, vol. 89(4), pages 615-641, August.
    8. Carl Shapiro, 1983. "Premiums for High Quality Products as Returns to Reputations," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 98(4), pages 659-679.
    9. James E. McClure & Lee C. Spector, 1991. "Joint Product Signals of Product Quality," Working Papers 199101, Ball State University, Department of Economics, revised Apr 1991.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. George, Donald A R, 2012. "Technical progress and product reliability under competition and monopoly," SIRE Discussion Papers 2012-23, Scottish Institute for Research in Economics (SIRE).
    2. George, Donald A. R., 2000. "A model of endogenous quality management," Journal of Economics and Business, Elsevier, vol. 52(3), pages 289-304.
    3. Donald A. R. George, 2011. "Technical progress and product reliability under competition and monopoly," Edinburgh School of Economics Discussion Paper Series 211, Edinburgh School of Economics, University of Edinburgh.
    4. Donald A R George, 2014. "Segmentation in Consumer Durables Markets," International Journal of Business Administration, International Journal of Business Administration, Sciedu Press, vol. 5(2), pages 13-22, March.
    5. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107687899.
    6. Ricardo Sellers†Rubio & Francisco Mas†Ruiz & Franco Sancho†Esper, 2018. "Firm reputation, advertising investment, and price premium: The role of collective brand membership in high†quality wines," Agribusiness, John Wiley & Sons, Ltd., vol. 34(2), pages 351-362, March.
    7. Pierre Fleckinger, 2007. "Collective Reputation and Market Structure: Regulating the Quality vs Quantity Trade-of," Working Papers hal-00243080, HAL.
    8. Michael Waldman, 1984. "The Role of Integrity in Economic Interaction," UCLA Economics Working Papers 350, UCLA Department of Economics.
    9. Cremer, Jacques & Khalil, Fahad, 1992. "Gathering Information before Signing a Contract," American Economic Review, American Economic Association, vol. 82(3), pages 566-578, June.
    10. Eric Rasmusen, 2008. "Quality-Ensuring Profits," Working Papers 2008-10, Indiana University, Kelley School of Business, Department of Business Economics and Public Policy.
    11. Butler, Jeffrey V. & Carbone, Enrica & Conzo, Pierluigi & Spagnolo, Giancarlo, 2020. "Past performance and entry in procurement: An experimental investigation," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 179-195.
    12. Brosig, Jeannette & Heinrich, Timo, 2011. "Reputation and Mechanism Choice in Procurement Auctions – An Experiment," Ruhr Economic Papers 254, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    13. W. Bentley MacLeod, 2006. "Reputations, Relationships and the Enforcement of Incomplete Contracts," CESifo Working Paper Series 1730, CESifo.
    14. Rasmusen, Eric, 2017. "A model of trust in quality and North–South trade," Research in Economics, Elsevier, vol. 71(1), pages 159-170.
    15. Chrysanthos Dellarocas, 2003. "The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms," Management Science, INFORMS, vol. 49(10), pages 1407-1424, October.
    16. Delgado García, Juan Bautista & De Quevedo Puente, Esther, 2016. "The complex link of city reputation and city performance. Results for fsQCA analysis," Journal of Business Research, Elsevier, vol. 69(8), pages 2830-2839.
    17. Jeanine Miklós-Thal, 2012. "Linking reputations through umbrella branding," Quantitative Marketing and Economics (QME), Springer, vol. 10(3), pages 335-374, September.
    18. Du, Chuang, 2012. "Solving payoff sets of perfect public equilibria: an example," MPRA Paper 38622, University Library of Munich, Germany.
    19. Goldsmith, Peter D. & Turan, Nesve A. & Gow, Hamish R., 2003. "Food Safety In The Meat Industry: A Regulatory Quagmire," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 6(1), pages 1-13.
    20. Jungju Yu, 2021. "A Model of Brand Architecture Choice: A House of Brands vs. A Branded House," Marketing Science, INFORMS, vol. 40(1), pages 147-167, January.

    More about this item

    Keywords

    Quality; Management; Warranties; JEL Classification: D21; D82; L14; L15; M21;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:ijecbs:v:4:y:1997:i:1:p:21-31. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/CIJB20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.