Competition in the presence of individual demand uncertainty.
This article offers a tractable model of (oligopolistic) competition in differentiated product markets characterized by individual demand uncertainty. The main result shows that, in equilibrium, firms offer advance purchase discounts and that these discounts are larger than in the monopolistic bench...
| Publicado en: | RAND Journal of Economics (Wiley-Blackwell) Vol. 47; no. 2; pp. 273 - 293 |
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| Autores principales: | , |
| Formato: | Artículo |
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Wiley-Blackwell
Summer2016
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| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| Sumario: | This article offers a tractable model of (oligopolistic) competition in differentiated product markets characterized by individual demand uncertainty. The main result shows that, in equilibrium, firms offer advance purchase discounts and that these discounts are larger than in the monopolistic benchmark. Competition reduces welfare by increasing the fraction of consumers who purchase in advance, that is, without (full) knowledge of their preferences. |
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