A Note on the Inefficiency of Competitive Markets For Quality Goods

John Schroeter

ISU General Staff Papers from Iowa State University, Department of Economics

Abstract: This note describes and investigates an equilibrium model of a service market in which customers search among many firms for ones offering acceptable combinations of money price and expected waiting time. Although neither firms nor customers possess market power, the noncooperative equilibrium of the model is inefficient: Forcing customers to be more selective in their choices of suppliers can produce Pareto improvements in welfare. This result is due to an externality, in queue accession decisions, which others have identified in related contexts..

Date: 1993-05-01
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://dr.lib.iastate.edu/server/api/core/bitstre ... be2054efc64e/content
Our link check indicates that this URL is bad, the error code is: 403 Forbidden

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:isu:genstf:199305010700001248

Access Statistics for this paper

More papers in ISU General Staff Papers from Iowa State University, Department of Economics Iowa State University, Dept. of Economics, 260 Heady Hall, Ames, IA 50011-1070. Contact information at EDIRC.
Bibliographic data for series maintained by Curtis Balmer ().