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
Creation-Date: March 1995
Unfortunately this paper is not available online. Please contact us to order a hardcopy.
SFB 303 Homepage