On the Economics of Repeat Buying

Jacques Crémer ()

RAND Journal of Economics, 1984, vol. 15, issue 3, 396-403

Abstract: This article presents a theory of such phenomena as coupons valid for the next purchase of a good and high initiation fees for clubs. In these cases the price of a nondurable good is lowered for second-time buyers. We show here that this can be explained by a model in which a monopolist sells a good, and the buyers are uncertain of their taste for the product but not of the quality of the product per se.

Date: 1984
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Citations: View citations in EconPapers (17)

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