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dc.contributor.authorBrekke, Kurt R.por
dc.contributor.authorSiciliani, Luigipor
dc.contributor.authorStraume, Odd Runepor
dc.identifier.citationBrekke, K. R., Siciliani, L., & Straume, O. R. (2018). Can Competition Reduce Quality?. Journal of Institutional and Theoretical Economics (JITE), 174(3), 421-447.por
dc.description.abstractWe analyze the effect of competition on quality provision in spatial markets where providers compete in both price and quality (e.g., health care, long-term care, child care, education). By making two key assumptions about the providers in such markets, namely that they are (partly) motivated and have decreasing marginal utility of income, we find, contrary to the existing literature, an unambiguously negative relationship between competition intensity and quality provision. This relationship holds regardless of whether quality and price decisions are made simultaneously or sequentially. However, even if competition reduces quality, it does not necessarily follow that social welfare is reduced.por
dc.description.sponsorship- The paper has benefited from comments and suggestions by Biung-Ghi Ju and two reviewers. Odd Rune Straume acknowledges the financial support provided by the European Regional Development Fund (ERDF) through the Operational Program Factors of Competitiveness (COMPETE); and by national funds received through the Portuguese Foundation for Science and Technology (FCT) under the research grant PEst-C/EGE/UI3182/2013.por
dc.publisherMohr Siebeckpor
dc.subjectQuality and price competitionpor
dc.subjectMotivated providerspor
dc.subjectDecreasing marginal utility of incomepor
dc.titleCan Competition Reduce Quality?por
dc.subject.wosSocial Sciences-
sdum.journalJournal of Institutional and Theoretical Economicspor
Appears in Collections:NIPE - Artigos em Revistas de Circulação Internacional com Arbitragem Científica

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