Economic Theories of Product Differentiation

Jean J. Gabszewicz
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Jean J. Gabszewicz: Université catholique de Louvain, LIDAM/CORE, Belgium

No 3354, LIDAM Reprints CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: This book provides a comprehensive exploration of product differentiation, blending insights from industrial organization, spatial economics, and game theory. In modern economies, nearly every product—from consumer electronics to household goods—comes in multiple variants, reflecting firms' strategic efforts to differentiate their offerings. But why do firms differentiate their products? How do they set prices for these variants? And does this process lead to an efficient market outcome? It examines both horizontal and vertical differentiation, investigating how firms compete not only on price but also on product characteristics such as location, quality, and perceived value. Special attention is given to the role of network effects, industry structure, and monopolistic competition, shedding light on how differentiation influences market dynamics.

Keywords: Industrial Organization; Market Structure and Economic Design; Regulation and Industrial Policy; Spatial Economics; Conceptual Foundations in Marketing Theory (search for similar items in EconPapers)
Pages: 117
Date: 2026-01-01
Note: Springer, 2025. - ISBN 978-3-031-95562-4
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Persistent link: https://EconPapers.repec.org/RePEc:cor:louvrp:3354

DOI: 10.1007/978-3-031-95563-1

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