Sep 21, 2007

Articles in journals

Garcia, F., Gabszewicz, J.

3

17

We analyze the optimal pricing choice of an incumbent firm that sells a good with network externalities and is threatened by the entry of a higher intrinsic quality variant. In the framework of a vertical differentiation model, we find a necessary and sufficient condition under which intrinsic quality improvement occurs as a result of this competition.

Vertical product differentiation,Network externalities,Quality improvement,