Nonlinear pricing and competition intensity in a Hotelling-type model with discrete product and consumer types
This paper develops a Hotelling model with discrete product and consumer types. We analyze the impact of horizontal differentiation (competition intensity) on relative prices. We find that the optimal price ratio of high- to low-quality products decreases with less competition.
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| Format: | Journal Article |
| Language: | Inglés |
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Elsevier
2011
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| Online Access: | https://hdl.handle.net/10568/154720 |
| Summary: | This paper develops a Hotelling model with discrete product and consumer types. We analyze the impact of horizontal differentiation (competition intensity) on relative prices. We find that the optimal price ratio of high- to low-quality products decreases with less competition. |
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