On advertising durability and product durability

Rajeev Goel

Applied Economics Letters, 2007, vol. 14, issue 1, 21-25

Abstract: This paper uses a simple two-period model to examine the behaviour of a monopolist who produces a durable good and engages in advertising that is also somewhat durable. It is found that changes in product durability and advertising durability have opposite effects on profit-maximizing output and advertising. Policy implications for antitrust and health regulation are discussed.

Date: 2007
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DOI: 10.1080/13504850500425550

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