Vertical Differentiation, Trade and Endogenous Common Standards

Luca Lambertini () and Gianpaolo Rossini
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Gianpaolo Rossini: Dipartimento di Scienze Economiche, Bologna

No 1997-18, CIE Discussion Papers from University of Copenhagen. Department of Economics. Centre for Industrial Economics

Abstract: Different market settings are considered in a free trade environment, where firms can choose technology, quality, and price or quantity. The shape of competition in prices requires the intervention of governments, via a common antidumping policy to make firms converge on the simultaneous equilibrium which is socially optimal. In the Cournot framework, the equilibria we obtain impinge upon the kind of precommitments undertaken by firms. The coincidence between firms’ behaviour and social preference obtains either when competition is tough, since income is low, or when firms must compete in quantities in the market stage, since they cannot modify qualities. The spontaneous coordination over common standards has to be contrasted with both the case of affluent consumers and Bertrand competition.

Keywords: technology; standard coordination (search for similar items in EconPapers)
JEL-codes: F12 F13 L13 (search for similar items in EconPapers)
Pages: 27 pages
Date: 1997-09
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Related works:
Working Paper: Vertical Differentiation, Trade and Endogenous Common Standards (1997)
Working Paper: Vertical Differentiaiton, Trade and Endogenous Common Standards (1996)
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Persistent link: https://EconPapers.repec.org/RePEc:kud:kuieci:1997-18

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