Oligopolistic Competition in Price and Quality

Arbeitspapier

We consider an oligopolistic market where firms compete in price and quality and where consumers are heterogeneous in knowledge: some consumers know both the prices and quality of the products offered, some know only the prices and some know neither. We show that two types of signalling equilibria are possible. Both are characterised by dispersion and Pareto-inefficiency of the price/quality offers. But, better price/quality combinations are signalled with lower prices in one type and with higher prices in the other type.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Tinbergen Institute Discussion Paper ; No. 08-068/1

Classification and Topics

• Classification: Wirtschaft ; Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection ; Search; Learning; Information and Knowledge; Communication; Belief; Unawareness ; Oligopoly and Other Imperfect Markets ; Information and Product Quality; Standardization and Compatibility
• Subject: oligopoly ; competition ; price ; quality ; imperfect information ; signalling ; Oligopol ; Preiswettbewerb ; Unvollkommene Information ; Signalling ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Dubovik, Andrei ; Janssen, Maarten C.W.
• Event: Veröffentlichung
• (who): Tinbergen Institute
• (where): Amsterdam and Rotterdam
• (when): 2008

Further information

• Handle: http://hdl.handle.net/10419/86746
• Last update: 10.03.2025, 11:41 AM CET