SFB 303 Discussion Paper No. A - 478

Author: Canoy, Marcel, and Martin Peitz
Title: The Differentiation Triangle
Abstract: The paper formalizes the observation that submarkets for high-quality and low-quality variants are markedly different from each other. We study a simple model where variants in the low-quality range are identical for every customer, whereas customers strongly disagree about the value of variants in the high-quality segment. We determine the outcome under price competition in the differentiation triangle with sequential entry when each firm can develop the full vertical product line or decide to follow a niche strategy, i. e. to develop only one variant.
Keywords: Product Differentiation, Product Design, Multi-Product Competition
JEL-Classification-Number: L13
Creation-Date: March 1995
Unfortunately this paper is not available online. Please contact us to order a hardcopy.

SFB 303 Homepage

12.05.1998, Webmaster