Sequential Entry in a Vertically Differentiated Duopoly

Lambertini, Luca ; Tedeschi, Piero (2003) Sequential Entry in a Vertically Differentiated Duopoly. Bologna: Dipartimento di Scienze economiche DSE, p. 31. DOI 10.6092/unibo/amsacta/4802. In: Quaderni - Working Paper DSE (492). ISSN 2282-6483.
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Abstract

We analyse a model of vertical differentiation focusing on the trade-off between entering early and exploiting monopoly power with a low quality, versus waiting and enjoying a dominant market position with a superior product. We show that there exists a unique equilibrium where the leader enters with a lower quality than the follower, for low discount factors, for high costs of quality and for low consumers’ willingness to pay for quality.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Lambertini, Luca
Tedeschi, Piero
Keywords
vertical differentiation, product innovation, monopoly rent
Subjects
ISSN
2282-6483
DOI
Deposit date
09 Mar 2016 15:07
Last modified
09 Mar 2016 15:07
URI

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