If It’s All the Same to You: Blurred Consumer Perception and Market Structure

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• 作者：Edward J. D. Webb
• 关键词：Perception ; Similarity ; Bounded rationality ; Bertrand competition ; Vertical differentiation ; Oligopoly
• 刊名：Review of Industrial Organization
• 出版年：2017
• 出版时间：February 2017
• 年：2017
• 卷：50
• 期：1
• 页码：1-25
• 全文大小：
• 刊物类别：Business and Economics
• 刊物主题：Industrial Organization; Microeconomics;
• 出版者：Springer US
• ISSN：1573-7160
• 卷排序：50

文摘

Consumers with bounded perception treat sufficiently similar goods as homogeneous. The effects of bounded perception on a vertically differentiated duopoly with sequential quality choice are examined. When quality entails fixed costs the market becomes more concentrated. When quality entails marginal costs, the second mover may profitably imitate the product of its rival, and the market is either more or less concentrated depending on how bounded perception is. When firms incur entry costs, neither firm may opt to produce when quality entails marginal costs, whereas at least one firm always produces when quality entails fixed costs.