Quality Provision in Interrelated Markets

Ralf Dewenter

No 7/2003, Working Paper from Helmut Schmidt University, Hamburg

Abstract: This paper analyses the quality provision of interrelated market firms under different market structures both theoretically and empirically. A theoretical model is built, where a media firm offers newspapers in a primary market and advertising space in the secondary market. Furthermore, the media firm is assumed to choose a continuous quality level for advertisements. To test the hypotheses from the theoretical model empirically, we use data on German regional newspapers. The theoretical outcomes as well as the empirical results support the hypothesis that a monopolist provides a higher quality than a duopolist.

Keywords: Quality Provision; Interrelated Markets; Pricing; Market Structure (search for similar items in EconPapers)
JEL-codes: L10 L15 L20 (search for similar items in EconPapers)
Pages: 50 pages
Date: 2003-06
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