Technology and Market Structure in the Defender Model

Simon Wey, Christian Jaag, Helmut Dietl and Urs Trinkner

No 36, Working Papers from Swiss Economics

Abstract: This paper enhances the defender model by explicitly modeling the cost associated with quality attributes. It considers two firms and two quality attributes which cause fixed and variable cost, respectively, together with the price attribute. Hence, firms compete in three dimensions. The optimal market defense is derived for various market structure and cost configurations. The theoretical findings are then applied to optimal market defense in the liberalized postal sector.

Keywords: Defender model; Market structure (search for similar items in EconPapers)
JEL-codes: L11 M31 (search for similar items in EconPapers)
Date: 2012-07
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Persistent link: https://EconPapers.repec.org/RePEc:chc:wpaper:0036

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