On production costs in vertical differentiation models

Dorothée Brécard

Economics Letters, 2010, vol. 109, issue 3, 183-186

Abstract: We analyze the effects of the introduction of a unit production cost in a vertical differentiation model with fixed costs of quality improvement: For a low (high) unit cost, a rise in cost reduces (increases) product differentiation and prices.

Keywords: Fixed; cost; Variable; cost; Product; quality; Vertical; differentiation (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (3)

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Working Paper: On production costs in vertical differentiation models (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:109:y:2010:i:3:p:183-186

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