Advertising Spillovers and Market Structure

Nada Ben Elhadj, Rim Lahmandi-Ayed and Didier Laussel ()

Post-Print from HAL

Abstract: In this paper we characterize the equilibrium of a duopoly market which exhibits advertising spillovers. Interestingly, we prove that the relevant distinction is not between pure positive and pure negative advertising spillovers but between strong positive spillovers and weakly positive or negative spillovers. Moreover, we prove that, depending on the extent of advertising spillovers and the agency advertising cost, we may obtain at equilibrium either two active advertisers or only one advertiser that may even push its rival out of the product market. Thus advertising and the spillovers induced from it may be a source of a monopoly situation, hence an asymmetric outcome may result from an initially symmetric situation.

Keywords: advertising spillovers; agency cost; quantity competition (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Published in Recherches Economiques de Louvain - Louvain economic review, 2014, 80 (3), pp.51-98. ⟨10.3917/rel.803.0051⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Advertising Spillovers and Market Structure (2014)
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:hal:journl:hal-01463118

DOI: 10.3917/rel.803.0051

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().