Product Lines and Price Discrimination in the European Car Market

Victor Ginsburgh and Shlomo Weber

Manchester School, 2002, vol. 70, issue 1, 101-114

Abstract: In this paper we consider a model of oligopolistic competition where firms make a two‐dimensional product line decision. They choose a location in style space, thus inducing horizontal differentiation, and produce different qualities (a product line) of a given good (vertical differentiation), consumed by a population of customers who differ in their income and preference for style. We prove the existence of a non‐cooperative equilibrium and show that, as the degree of competition increases, prices approach marginal cost. The approach is used to show that European car producers seem indeed to use product lines to discriminate across EU countries.

Date: 2002
References: Add references at CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
https://doi.org/10.1111/1467-9957.00286

Related works:
Working Paper: Product lines and price discrimination in the European car market (2002)
Working Paper: Product Lines and Price Discrimination in the European Car Market (1996)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:manchs:v:70:y:2002:i:1:p:101-114

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1463-6786

Access Statistics for this article

Manchester School is currently edited by Keith Blackburn

More articles in Manchester School from University of Manchester Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().