Monopolist's Quality Choices Impact Society's Welfare in Durable-Goods Market.
The article explores how a company that sells long-lasting products can balance making high-quality items with the problem of changing its mind over time. The company might choose top-notch quality to deal with this issue, even though it could lead to overproviding quality. Depending on the situation, the company might increase or decrease quality compared to what would be best in a perfect world. The lack of commitment power could actually harm society, which goes against what traditional theories say about how these companies should set prices.