30 research outputs found
Vertical Product Differentiation When Quality is Unobservable to Buyers
We analyze vertical product differentiation in a model where a good’s quality is unobservable to buyers before purchase, a continuum of quality levels is technologically feasible, and minimum quality is supplied under competitive conditions. After purchase the true quality of the good is revealed with positive probability. To provide firms with incentives to actually deliver promised quality, prices must exceed marginal cost. We derive sufficient conditions for these incentive constraints to determine equilibrium prices, and show that under certain conditions only one or both of the extreme levels of quality, minimum and maximum quality, are available in the market.experience goods, product differentiation, product quality, asymmetric information
Capital Gains and Losses and the Existence of a Steady State in Multisectoral Models with Induced Technological Progress
Shut down costs, borrowing from nature, and negative capital: A rejoinder to Professor Nuti
Monopoly pricing in the binary herding model
How should a monopolist price when selling to buyers who learn from each other’s decisions? Focusing on the case in which the common value of the good is binary and each buyer receives a binary private signal about that value, we completely answer this question for all values of the production cost, the precision of the buyers’ signals, and the seller’s discount factor. Unexpectedly, we find that there is a region of parameters for which learning stops at intermediate and at extreme beliefs, but not at beliefs that lie between those intermediate and extreme beliefs
Wicksell's missing equation and Böhm-Bawerk's three causes of interest in a stationary state
From Linear to Nonlinear Utility in Vintage Capital Models
Optimization problems with nonlinear utility and endogenous capital lifetime are investigated in one- and two-sector modifications of the Solow vintage capital model. Both models have the same balanced growth path in the case of exponential technological change and labour. Turnpike theorems in normal form are proved for the optimal capital lifetime in both models. The differences between the cases of the linear and nonlinear utility are highlighted.balanced growth path, capital lifetime, nonlinear utility, optimization, turnpike theorems, vintage capital models,
Preis- und Mengeneffekte in kurz- und langfristiger Analyse
Preis- und Mengeneffekte in kurz- und langfristiger Analyse. - In: Kyklos. 32. 1979. S. 162-17