The determinants of product lines

• 成果类型: Article
• 署名作者: Johnson, Justin P.; Myatt, David P.
• 署名单位: Cornell University; University of London; London Business School
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/1756-2171.12244
• 发表日期: 2018
• 页码: 541-573
• 关键词: 3rd-degree price-discrimination; quantity competition; multiproduct firms; nonlinear prices; monopoly; QUALITY; welfare; differentiation; DESIGN

摘要

We study product line choice allowing for cost asymmetries but ruling out strategic motivations such as a desire to soften competition. We identify two forces that interact with asymmetric competition to shape equilibrium product lines. Possible outcomes range from head-to-head competition to complete separation of product lines and include the intermediate case of partial separation. In an international trade context, we predict which qualities a disadvantaged foreign producer will specialize in. If cost factors drive quality-based discrimination then foreign firms sell only lower qualities. However, if demand factors are the main drivers then foreign firms sell only high qualities.