scholarly journals Dynamic Durable Goods Monopoly and Market Power

Games ◽  
2020 ◽  
Vol 11 (2) ◽  
pp. 22
Author(s):  
Basak Altan
Keyword(s):  
Market Power ◽  
Discrete Time ◽  
Durable Goods ◽  
Infinite Horizon ◽  
Monopoly Power ◽  
Durable Good ◽  
Durable Goods Monopoly ◽  
Markov Perfect

We analyze a vertically differentiated market for an imperfectly durable good served by a monopolist in an infinite-horizon, discrete-time game. Our goal is to identify the Markov perfect stationary equilibria where the seller can maintain his monopoly power. We establish that the set of parameters supporting a monopoly outcome is larger when the seller offers different quality versions of the same product. Hence, our results suggest that, when the innate durability of a product is high, the seller should offer different quality versions of the product.

scholarly journals Pricing strategy in the context of durable goods monopoly with discrete demand

2015 ◽  
Vol 60 (204) ◽  
pp. 61-73
Author(s):  
Paulo Nunes
Keyword(s):  
Willingness To Pay ◽  
Interest Rates ◽  
Low Income ◽  
Durable Goods ◽  
Pricing Strategy ◽  
Durable Good ◽  
Durable Goods Monopoly ◽  
Coase Conjecture ◽  
Low Incomes ◽  
The Difference

Considering a model of discrete demand with two consumers, this article shows that irrespective of the difference between the willingness to pay of consumers with high and low incomes, if interest rates are low, a durable goods monopolist has an advantage in discriminating prices over time. If the difference in willingness to pay is limited and interest rates high, the monopolist has an advantage in setting a price equal to the low-income consumer?s willingness to pay. Finally, in the case of great difference in willingness to pay and high interest rates, the monopolist has an advantage in setting a price equal to the high-income consumer?s willingness to pay, and not selling the durable good to the low-income consumer. The results show that the Coase conjecture can fail if the difference in willingness to pay is great, and interest rates are high.

Efficiency in one-sector, discrete-time, infinite-horizon models

1984 ◽  
Vol 33 (1) ◽  
pp. 183-196 ◽  
Author(s):  
Anders Borglin ◽  
Hans Keiding
Keyword(s):  
Discrete Time ◽  
Infinite Horizon
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