Download or read book Essays on Product Differentiation and Market Structure written by Andreas Irmen and published by . This book was released on 1996 with total page 212 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Product Differentiation and Market Structure written by Yun Mi Nam and published by . This book was released on 2011 with total page 202 pages. Available in PDF, EPUB and Kindle. Book excerpt: Abstract: Competing firms strategically interact when they make decisions about entry/exit, a product type, or technology adoption. This dissertation explores the determinants of firms' strategies and the effect on the resulting market structure. The first chapter analyzes product differentiation and market structure in the Texas lodging industry. I model the lodging properties' entry, exit and quality decisions as a dynamic oligopoly game and apply the estimation strategy similar to the Nested Pseudo Likelihood (NPL) Algorithm. Using annual data for hotels and motels in Texas in the 1990's, I find that there is a strong incentive for the lodging properties to differentiate themselves by choosing different quality-levels from competitors. Also, I show that high transition costs relative to the exit value deter low quality-level properties from changing their quality-level and induce more to exit. The second chapter investigates the relationship between risk and vertical integration. I modify an ordered Probit model to examine how economic factors, particularly risks, affect the choice of organizational form. I estimate the model using cross-sectional data on the company-owned, franchised and independent properties in the Texas lodging industry. The estimation result shows that overall market risk strengthens the independent properties and weakens the other two forms (franchised and company-owned properties). It also indicates that the form-specific risk is significantly associated with the choice of the organizational form. The third chapter estimates the size of hospital markets, which plays a key role in the antitrust enforcement of hospital mergers. I determine the relevant market size by finding the distance between hospitals at which the choices of technology adoption do not interact, using data on the adoption of SPECT diagnostic imaging technologies. I show that the Elzinga/Hogarty approach taken in the antitrust cases overestimates the relevant market size of hospitals.

Download or read book Essays in Competition with Product Differentiation and Bargaining in Markets written by Jan Bouckaert and published by . This book was released on 1996 with total page 131 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Economic Theory of Product Differentiation written by John Beath and published by Cambridge University Press. This book was released on 1991-02-22 with total page 220 pages. Available in PDF, EPUB and Kindle. Book excerpt: There are few industries in modern market economies that do not manufacture differentiated products. This book provides a systematic explanation and analysis of the widespread prevalence of this important category of products. The authors concentrate on models in which product selection is endogenous. In the first four chapters they consider models that try to predict the level of product differentiation that would emerge in situations of market equilibrium. These market equilibria with differentiated products are characterised and then compared with social welfare optima. Particular attention is paid to the distinction between horizontal and vertical differentiation as well as to the related issues of product quality and durability. This book brings together the most important theoretical contributions to these topics in a succinct and coherent manner. One of its major strengths is the way in which it carefully sets out the basic intuition behind the formal results. It will be useful to advanced undergraduate and graduate students taking courses in industrial economics and microeconomic theory.

Download or read book Essays on Vertical Product Differentiation written by Yong-Hwan Noh and published by . This book was released on 2005 with total page 218 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation explores models of heterogeneous product markets that rely on the "vertical product differentiation" formulation. The demand structure applied here is the covered-market configuration under the vertical product differentiation. With this specification, product market equilibria of the monopoly and duopoly market are derived. In particular, parameter restrictions on the degree of relative consumer heterogeneity associated with the covered-market setting are identified and used to interpret analytical results. Based on the specified demand structure, I revisit two industrial organization topics from the perspectives of vertical product differentiation. The first essay analyzes the entry of a new product into a vertically differentiated market where an entrant and an incumbent compete in prices. Many models on strategic entry deterrence deal with "limit quantities" as the established firm's strategic tool to deter or accommodate entry. Here, however, the entry-deterrence strategies of the incumbent firm rely on "limit qualities". With a sequential choice of quality, quality-dependent marginal production cost, and a fixed entry cost, I relate the entry-quality decision and the entry-deterrence strategies to the level of an entry cost and the degree of consumer heterogeneity. In particular, the incumbent influences the quality choice of the entrant by choosing its quality level before the entrant. This allows the incumbent to "limit" the entrant's entry decision and quality levels. Quality-dependent marginal production costs in the model entail the possibility of inferior-quality entry as well as the incumbent's aggressive entry-deterrence strategies by increasing its quality level towards potential entry. Welfare evaluation confirms that social welfare is not necessarily improved when entry is encouraged rather than deterred. The second essay is motivated by some specific economic questions that have arisen with the introduction of 'genetically modified' (GM) agricultural products. A duopoly market-entry model associated with the vertical product differentiation is developed to show how the existence of segregation costs biases the firm's quality choice behavior. Thus, the key factor of the model is the cost of segregation activities that are necessary to distinguish GM products from non-GM products. With an increasing and convex cost of quality, the model predicts that the entrant firm has an increased incentive to enter the market with a low-quality good to reduce production costs if segregation costs are sufficiently high. When consumers are homogeneous enough, however, entry may occur with the high-quality good.

Download or read book Essays on Economics of Vertical Product Differentiation written by Taehoon Youn and published by . This book was released on 1999 with total page 256 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays on Oligopolistic Competition Product Differentiation and International Trade written by Fayçal Régis Sinaceur and published by . This book was released on 1999 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This Thesis presents three essays in the area of strategic trade theory and policy. The first essay presents an analysis of trade and welfare between countries with asymmetric conditions. A two-period two-country address model of product differentiation is examined in which firms face an initial period of autarky. Trade takes place in the subsequent period and firms fully anticipate switches in trade regimes. Results suggest that historical (domestic) conditions matter a lot on the international market place. Firms that come from countries with a larger market tend to develop longer product lines, which puts that country in a dominant position in international competition. The model is also used to analyse gains/losses from trade in relation to country size. The second essay investigates the differential effects of specific and ad-valorem tariffs on quality, price and welfare in an oligopolistic industry consisting of foreign and domestic firms. These effects are shown to depend on the location of the home and foreign firms in the quality spectrum. Both tariffs are ranked and conditions for either tariff to be welfare superior are derived. Finally, the third essay presents an analysis of trade policy with endogenous market structure. A "third market model" is specified. Using a simple framework in which industry structure is derived endogenously as the outcome of product line decisions by firms, we show that governments have an incentive to affect the equilibrium product composition by setting non-zero subsidy rates in order to maximize domestic welfare. Subsidies may be uniform or non-uniform across goods and the optimal policy exhibits strong discontinuities as domestic welfare maximization implies a switch of regimes.

Download or read book Three Essays on Differentiated Product Markets and Competition Policy written by Abigail Britton Ferguson and published by . This book was released on 2009 with total page 422 pages. Available in PDF, EPUB and Kindle. Book excerpt: My dissertation features three essays in industrial organization. The first two investigate aspects of potentially anticompetitive firm behavior in differentiated product markets. Contrary to previous analyses, requirements tying and bundled rebates by a firm with a monopoly in one market that competes in another may increase total surplus when product differentiation in the competitive market is endogenous. This result is stronger for tying than for bundled rebates, and holds for both horizontal and vertical differentiation (essays 1 and 2, respectively). Under requirements tying or bundled rebates, a multiproduct firm (horizontally) differentiates its product less from its rival's product than it would under independent pricing, suggesting a new efficiency consideration for requirements tying: a reduction in transport costs. A similar result prevails under vertical differentiation: when the tying firm controls either quality niche, it reduces the quality of its tied product; however, the rival may invest in the quality of its competing product. Hence, the effect on total surplus is ambiguous when tying or bundled rebates arrangements are permitted. The second essay employs an empirical model typically used to analyze differentiated product markets analyze a different economic environment: parents' decision to home school their children. Home schooling has grown in popularity as an alternative to public or private schools; some estimates place growth at 15 to 40% per year in the U.S.I empirically estimate the demand for home schooling as an alternative to these other modes of education, focusing on potential network effects in household decisions to home-school. I find support for the hypothesis that home schooling 'support groups' mitigate the cost of home schooling relative to the alternatives, but only occur in areas with a critical mass of home-schooling households. The data also suggest that as interest in home schooling grows, the local community's school district spending per child declines, increasing the probability that more parents will take their children out of public schools. Both phenomena suggest the existence of network effects in the market for primary and secondary education.

Download or read book Essays on Financial Intermediation Product Differentiation and Market Structure written by Hans Degryse and published by . This book was released on 1995 with total page 218 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Quality and Product Differentiation written by David Werner Meyer and published by . This book was released on 1996 with total page 194 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Product Development and Market Structure written by Korhan Gurkan and published by . This book was released on 2005 with total page 234 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Product Differentiation and Dynamics of Market Structure written by Jaehong Kim and published by . This book was released on 1988 with total page 240 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Market Structure and Technological Innovation written by Benjamin Christopher Anderson and published by . This book was released on 2011 with total page 124 pages. Available in PDF, EPUB and Kindle. Book excerpt: Prior to estimating the empirical model, I illustrate the theoretical lower bounds to market concentration implied by an endogenous fixed cost (EFC) model with vertical and horizontal product differentiation and derive the theoretical lower bound to R & D concentration from the same model. Using data on field trial applications of genetically modified (GM) crops, I empirically estimate the lower bound to R & D concentration in the agricultural biotechnology sector. I identify the lower bound to concentration using exogenous variation in market size across time, as adoption rates of GM crops increase, and across agricultural regions.

Download or read book Essays on Microeconomics and Industrial Organisation written by Pablo Coto-Millán and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 385 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essays on Microeconomics and Industrial Organisation aim to serve as a source and work of reference and consultation for the field of Microeconomics in general and of Industrial Organisation in particular. Traditionally, Microeconomics is essentially taught as theory and hardly ever an estimation of a demand, production and cost function is offered . Over the last two decades, however, Microeconomics has greatly broadened its field of empirical application. Therefore, this text combines microeconomic theories with a variety of empirical cases. The standardised microeconomic analysis of demand, production and costs is set forth along with appropriate econometric techniques. The text consists of four parts: Demand, Production and Costs (Supply), Market and Industrial Structure and Failure of Market and Industrial Regulation. It includes eleven new chapters with respect to the first edition.

Download or read book Essays on Firm Strategies and Market Outcomes written by Brady Thomas Vaughan and published by . This book was released on 2015 with total page 113 pages. Available in PDF, EPUB and Kindle. Book excerpt: In the first chapter of my dissertation, Aleksandr Yankelevich and I examine the effects of price matching guarantees on duopoly markets. We find that a commitment to price-match raises prices by altering consumer search behavior in three ways. First, price-matching diminishes firms' incentives to lower prices to attract consumers who have no search costs. Second, for consumers with positive search costs, price-matching lowers the marginal benefit of search, inducing them to accept higher prices. Finally, price-matching can lead to asymmetric equilibria where one firm runs fewer sales and both firms tend to offer smaller discounts than in a symmetric equilibrium. These price increases grow with the proportion of consumers who invoke price-matching guarantees and also in the level of equilibrium asymmetry. The second chapter studies the effect of the complexity of consumers' preferences over a product on that product's market structure. I relate complexity of preferences to the number of dimensions of a Lancasterian characteristic space. Using a novel higher dimensional Hotelling model, I find that a fixed number of firms are likely to be better off competing over products with more complex preferences. Although firms face more intense competition in higher dimensional markets, the greater product differentiation afforded to them allows them to charge higher prices and earn higher profits. This result provides a clear theoretical foundation for the observation that goods associated with more complex preferences typically display a greater variety of products sold. Additionally, I show that the behavior of more than two firms competing in more than one dimension differs wildly from that of firms typically studied in models of spatial competition. The final chapter will examine firms' motives for implementing grandfather clauses that allow certain consumers to continue to access a service at a favorable, but no longer available price. Grandfather clauses permit firms to price discriminate between early adopters and new consumers in exchange for forfeiting the right to optimally set prices for early adopters. They may be used to thwart competition following a structural change, to respond to cost shocks, or to retain customers who consume another good from a multiproduct firm. We analyze under what conditions firms might choose to offer grandfather clauses and what effects they have on welfare.

Download or read book Three Essays on Product Differentiation written by Marco Di Cintio and published by . This book was released on 2005 with total page 71 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Essays on Marketing Strategy written by Yeong Seon Kang and published by . This book was released on 2012 with total page 125 pages. Available in PDF, EPUB and Kindle. Book excerpt: The objective of this dissertation is to understand optimal firm strategies (distribution channel structure, product and pricing strategies) using the Hotelling model in a duopoly competition. In Essay 1, I study how distribution channel structure affects quality decisions in a duopoly competition. I consider a set-up in which two retailers with different distribution channel structures compete on product quality and retail price. Channel decentralization can lead to more quality differentiation, which can soften the price competition. It turns out that two asymmetric strategy equilibria of an integrated and a decentralized channel structure exist. A retailer can adopt the integrated channel structure in which the retailer has the power to determine the quality of its product or can adopt the decentralized channel structure in which the supplier determines the product quality. I find that the asymmetric pairs of a decentralized channel by one retailer and an integrated channel by the other retailer can be a Nash equilibrium in a simultaneous-channel-choice model. In a sequential-channel-choice model, I find that the leader-retailer chooses the integrated channel and the follower-retailer chooses the decentralized channel and the leader can get a first-mover advantage. From a supplier's perspective, who can decide the distribution channel structure and level of quality, symmetric pairs of distribution channel structures are the equilibrium. When the market is covered and the competition between the channels exists, both suppliers choose the decentralized channel in equilibrium. When the market is not covered and each channel plays as a local monopoly, both suppliers choose the integrated channel in equilibrium. When I extend the model by adding two-dimensional consumer heterogeneity, the results are consistent with the basic model under certain conditions of the demand specification. In Essay 2, I analyze a duopoly competition when two firms face input cost increases. The objective of this study is to determine the firms' optimal strategy between a price increase and downsizing under conditions of a spatially differentiated market and consumers' diminishing utility on the product size. I analyze both symmetric and asymmetric cases of firms' original cost conditions. I find that when the two firms have the symmetric cost structures (i.e., the two firms have the same marginal cost), both firms choose the symmetric strategy in equilibrium and it depends on the amount of the cost increase. When the cost increase is sufficiently large, the two firms choose downsizing is a unique Nash equilibrium. When the input cost increase is sufficiently small, a price increase is a dominant strategy because both firms can pass the entire amount of the cost increase to the end consumers via the price increase and they can maintain their profits. When the input cost increase is intermediate, there are two Nash equilibria: (a) both firms choose a price increase or (b) both firms choose downsizing. I find that when the two firms have the asymmetric cost structures, the two firms might choose asymmetric pairs of strategies in equilibrium under certain conditions. The equilibrium outcomes depend on the cost differences between two firms and the amount of the cost increase. When the cost differences between the two firms are sufficiently small and the cost increase is sufficiently small, a price increase is the dominant strategy for both firms. When the cost differences between the two firms are sufficiently large and the cost increase is sufficiently small, the cost leader chooses a price increase, and the cost-disadvantaged firm chooses downsizing in equilibrium. When the cost increase is sufficiently large, both firms are reducing the product size in equilibrium. I extend model including an interaction effect between a consumer's loyalty and diminishing utility on the product size. Unexpectedly, downsizing might not be more favorable when a consumer's loyalty is weighted on the consumer's utility from the product size.