A Dynamic Analysis of a Monopolist’s Perceived Quality with Product Innovation and Reference Price

Shoude Li () and Régis Y. Chenavaz
Additional contact information
Shoude Li: Antai College of Economics and Management, Shanghai Jiao Tong University, Shanghai 200052, P. R. China
Régis Y. Chenavaz: Kedge Business School, MOSI, Domaine de Luminy, 13008 Marseille, France

Asia-Pacific Journal of Operational Research (APJOR), 2025, vol. 42, issue 02, 1-24

Abstract: In this paper, we develop a dynamic analysis model to investigate a monopolist’s perceived quality with product innovation and reference price effects, in which price and reference price are used both as a signal of quality, while product quality and advertising effort are used only as a signaling device. We show that (i) the stability of steady-state equilibrium depends on the admissible parameters; (ii) there is always a fixed proportional relationship between the efforts for product innovation and improving perceived quality; (iii) there is always a positive relationship between the price and product quality (or price and perceived quality; price and reference price).

Keywords: Perceived quality; product innovation; reference price; quality signaling; optimal control application (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.worldscientific.com/doi/abs/10.1142/S0217595925500071
Access to full text is restricted to subscribers

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:wsi:apjorx:v:42:y:2025:i:02:n:s0217595925500071

Ordering information: This journal article can be ordered from

DOI: 10.1142/S0217595925500071

Access Statistics for this article

Asia-Pacific Journal of Operational Research (APJOR) is currently edited by Gongyun Zhao

More articles in Asia-Pacific Journal of Operational Research (APJOR) from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().