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The joint determination of ‘Quality’ and price in standardized products: A comparative dynamic analysis
Author(s) -
Aislabie Colin
Publication year - 1985
Publication title -
managerial and decision economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.288
H-Index - 51
eISSN - 1099-1468
pISSN - 0143-6570
DOI - 10.1002/mde.4090060304
Subject(s) - monopoly , product (mathematics) , quality (philosophy) , industrial organization , process (computing) , microeconomics , economics , vulnerability (computing) , joint (building) , business , computer science , mathematics , engineering , computer security , architectural engineering , philosophy , geometry , epistemology , operating system
Every supermarket provides many examples of attempts lo develop more economical standardized products which will attract additional customers while guaranteeing the user that the quantity will be acceptable. We assume this process involves development costs incurred in reducing the amount incorporated in a monopoly product of its dominant product‐characteristic. A comparative dynamic analysis is used to explore the search for lower prices and higher output. The heightened vulnerability of the firm to market forces and some policy implications of the analysis are brought out.