Business, Management and Accounting
4 years ago

Monopolist's strategic product variety choice boosts social welfare, study finds.

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RePEc: Research Papers in Economics
Choice of Product Variety for the Durable Goods Monopolist
Ana I. Saracho, Francisco Javier Casado Izaga

Paper Summary

The article discusses how a company selling a popular product can use different versions of the product to prevent competitors from lowering prices. By offering a variety of options, the company can keep prices stable and attract more customers. The research shows that when the company cannot promise to keep prices high, it actually benefits society more.

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