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Opening Hours and Quality Choices

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  • Yamada, Mai

Abstract

Using a duopoly model with symmetric retailers, we show that retailer strategies regarding opening hours and quality choices of goods vary depending on the cost structure of the quality investment in goods. In the case of the cost remaining constant regardless of the length of opening hours, a retailer with longer opening hours chooses higher quality and charges higher prices. Conversely, in the case of the cost increasing proportional to opening hours, a retailer with longer opening hours chooses lower quality and charges lower prices. The latter case is consistent with the behavior of retailers in Japan.

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  • Yamada, Mai, 2014. "Opening Hours and Quality Choices," MPRA Paper 56066, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:56066
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    References listed on IDEAS

    as
    1. Oz Shy & Rune Stenbacka, 2008. "Price Competition, Business Hours and Shopping Time Flexibility," Economic Journal, Royal Economic Society, vol. 118(531), pages 1171-1195, August.
    2. Inderst, Roman & Irmen, Andreas, 2005. "Shopping hours and price competition," European Economic Review, Elsevier, vol. 49(5), pages 1105-1124, July.
    3. Morrison, Steven A & Newman, Robert J, 1983. "Hours of Operation Restrictions and Competition among Retail Firms," Economic Inquiry, Western Economic Association International, vol. 21(1), pages 107-114, January.
    4. Tobias Wenzel, 2011. "Deregulation of Shopping Hours: The Impact on Independent Retailers and Chain Stores," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(1), pages 145-166, March.
    5. Shy, Oz & Stenbacka, Rune, 2006. "Service hours with asymmetric distributions of ideal service time," International Journal of Industrial Organization, Elsevier, vol. 24(4), pages 763-771, July.
    6. Clemenz, Gerhard, 1990. "Non-sequential consumer search and the consequences of a deregulation of trading hours," European Economic Review, Elsevier, vol. 34(7), pages 1323-1337, November.
    7. Gerhard CLEMENZ, 1990. "Competition Via Shopping Hours: A Case For Regulation?," Vienna Economics Papers vie9005, University of Vienna, Department of Economics.
    8. Cancian, Maria & Bills, Angela & Bergstrom, Theodore, 1995. "Hotelling Location Problems with Directional Constraints: An Application to Television News Scheduling," Journal of Industrial Economics, Wiley Blackwell, vol. 43(1), pages 121-124, March.
    9. Tanguay, Georges & Vallee, Luc & Lanoie, Paul, 1995. "Shopping Hours and Price Levels in the Retailing Industry: A Theoretical and Empirical Analysis," Economic Inquiry, Western Economic Association International, vol. 33(3), pages 516-524, July.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Duopoly; Opening hours; Multi-dimensional product differentiation;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • R32 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Other Spatial Production and Pricing Analysis

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