Intermediate product versioning

Wuyi Cao, Meichen Chen and Youping Li

Economics Letters, 2024, vol. 238, issue C

Abstract: The strategic creation and management of multiple product versions are frequently utilized to exploit heterogeneous buyers. This paper examines the versioning of an intermediate product when downstream retailers compete in the consumer market. Our analysis demonstrates a departure from conventional wisdom in final product markets: versioning an intermediate product reduces the profit of the upstream firm. This reduction occurs as the market power of the retailers is enhanced, leading to a decline in consumer and total welfare.

Keywords: Versioning; Intermediate product; Welfare (search for similar items in EconPapers)
JEL-codes: L1 M3 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176524002143
Full text for ScienceDirect subscribers only

Related works:
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:eee:ecolet:v:238:y:2024:i:c:s0165176524002143

DOI: 10.1016/j.econlet.2024.111731

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().