Download (321kB)
Abstract
This paper analyses a model of vertical product differentiation with one incumbent and one entrant firm. It is shown that if firms can produce only one quality level welfare in this entry game can be lower than in monopoly. This is the case if qualities are strategic complements because the incumbent may distort its quality downwards. If firms can produce a quality range and practice non-linear pricing welfare in case of entry deterrence is higher than in monopoly because the incumbent enlarges its product line. If entry is accommodated consumer rent increases but the consequences on welfare are ambiguous.
| Dokumententyp: | Paper |
|---|---|
| Keywords: | Entry Deterrence ; Price Discrimination ; Vertical Differentiation |
| Fakultät: | Volkswirtschaft
Volkswirtschaft > Munich Discussion Papers in Economics Volkswirtschaft > Munich Discussion Papers in Economics > Industrieökonomik Volkswirtschaft > Lehrstühle > Seminar für Dynamische Modellierung (aufgelöst) |
| Themengebiete: | 300 Sozialwissenschaften > 300 Sozialwissenschaft, Soziologie
300 Sozialwissenschaften > 330 Wirtschaft |
| JEL Classification: | D43, L13, L65 |
| URN: | urn:nbn:de:bvb:19-epub-479-5 |
| Sprache: | Englisch |
| Dokumenten ID: | 479 |
| Datum der Veröffentlichung auf Open Access LMU: | 13. Apr. 2005 |
| Letzte Änderungen: | 08. Nov. 2020, 11:10 |
- Dokument bearbeiten
