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| Author: | Suen, W. |
| Title: | The value of product diversity. |
| Journal: | Oxford Economic Papers
1991 : APR, VOL. 43:2, p. 217-223 |
| Index terms: | PRODUCT PREFERENCE DIVERSIFICATION |
| Language: | eng |
| Abstract: | The random utility maximization model of McFadden is used to derive some results concerning the value of diversity. It is not necessary to assume variety is the spice of life in order to explain the value of variety. There is given a rigorous demonstration of the notion that heterogeneity is product value and the maximizing behaviour of individuals may be one reason why product diversity is desirable. Some comparative statistic results concerning the value of diversity are derived while variability can be a source of risk, it can also present opportunities that individuals can take advantage of. |
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