Minimum Quality Standards with More Than Two Firms Under Cournot Competition

Mario Pezzino ()

The IUP Journal of Managerial Economics, 2010, vol. VIII, issue 3, 26-45

Abstract: This paper presents a study of the effects of the introduction of a Minimum Quality Standard (MQS) in a vertically differentiated market in which three identical firms compete in quantities in the short run and face quality-dependent fixed costs. In contrast to what has been shown under the assumption of Bertrand triopolistic competition (Scarpa, 1998), the introduction of an MQS has a positive effect on the average provision of quality.

Date: 2010
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Working Paper: Minimum quality standards with more than two firms under Cournot competition (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:icf:icfjme:v:08:y:2010:i:3:p:26-45

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