search query: @author Waterson, M. / total: 18
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| Author: | Waterson, M. |
| Title: | Product differentiation and profitability: an asymmetric model. |
| Journal: | Journal of Industrial Economics
1990 : DEC, VOL. 39:2, p. 113-130 |
| Index terms: | PRODUCT DIFFERENTIATION PROFITABILITY MODELS |
| Language: | eng |
| Abstract: | A model of product differentiation is developed in which there is an asymmetry, namely that some customers are easier to serve than others. It turns out that profits are negatively related to difficulty of service, and that profits and market share are negatively related. The results of this model are used to shed light on some aspects of the collusion versus differential efficiency debate, and are also compared with vertical product differentiation models. The first issue relates to the intra-industry behaviour of profitability and its implications. The other point concerns the more general question of why efficiency differences between firms persist. The model explains how the rents to particular firms arise. |
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