Utilize este identificador para referenciar este registo:
https://hdl.handle.net/1822/36422
Título: | A dynamic model of quality competition with endogenous prices |
Autor(es): | Cellini, Roberto Siciliani, Luigi Straume, Odd Rune |
Palavras-chave: | Competition Quality Differential-games |
Data: | 2015 |
Editora: | Universidade do Minho. Núcleo de Investigação em Políticas Económicas (NIPE) |
Resumo(s): | We develop a dynamic model of price and quality competition in order to analyse the effects of competition intensity on quality provision and to which extent an unregulated market is able to provide a socially optimal quality level. Using a differential-game approach with price and quality competition on a Hotelling line, we compare the benchmark open-loop solution against the feedback closed-loop solution, which implies strategic dynamic interaction over time. We find that steady-state quality in the closed-loop solution is (i) increasing in the degree of competition between firms, (ii) lower than in the open-loop solution, and (iii) lower than the socially optimal level. In contrast, steady-state quality in the open-loop solution is at the socially optimal level and independent of competition intensity. Thus, our analysis identifies dynamic strategic interactions between competing firms as an independent source of inefficiency in quality provision. |
Tipo: | Documento de trabalho |
URI: | https://hdl.handle.net/1822/36422 |
Versão da editora: | http://www.nipe.eeg.uminho.pt/Uploads/WP_2015/NIPE_WP_08_2015.pdf |
Arbitragem científica: | no |
Acesso: | Acesso aberto |
Aparece nas coleções: | NIPE - Documentos de Trabalho |
Ficheiros deste registo:
Ficheiro | Descrição | Tamanho | Formato | |
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NIPE_WP_08_2015.pdf | A dynamic model of quality competition with endogenous prices | 481,46 kB | Adobe PDF | Ver/Abrir |