Monopoly, Quality, and Network Externalities

Lambertini, Luca ; Orsini, Raimondello (2000) Monopoly, Quality, and Network Externalities. DOI 10.6092/unibo/amsacta/721.
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Abstract

We describe the behaviour of a monopolist supplying a vertically differentiated good with network externalities. Assuming a fixed cost of quality improvements, we show that the presence of network externalities enhances the incentive to expand output associated with scale economies. Although the quality distortion operated by the monopolist increases with network externalities, the output expansion effect is dominant, so that the welfare loss due to monopoly power shrinks as the role of network externalities in determining consumers’ satisfaction becomes more relevant.

Abstract
Tipologia del documento
Monografia (Working paper)
Autori
AutoreAffiliazioneORCID
Lambertini, Luca
Orsini, Raimondello
Parole chiave
monopoly quality distortion network externalities market cover-age social planning
Settori scientifico-disciplinari
DOI
Data di deposito
17 Giu 2004
Ultima modifica
17 Feb 2016 14:02
URI

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