Quality Premiums and the Competitive Firm's Production Decision
The impact of price-quality schedule changes on the 'optimal input choice' of producers which subscribe to a minimum quality standard is investigated using the stochastic dominance method. In addition, the effects of a transition from a fixed price schedule to a quality-dependent price schedule are examined. The correlations between production technology, a minimum quality standard and price levels needed to ensure that total and marketed output remains the same are also discussed.
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|Date of creation:||01 Jul 1995|
|Date of revision:|
|Publication status:||Published in Southern Economic Journal, July 1995, vol. 62, pp. 107-115|
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