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Strategic Interaction and Markets$
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Jean J. Gabszewicz

Print publication date: 2000

Print ISBN-13: 9780198233411

Published to Oxford Scholarship Online: November 2003

DOI: 10.1093/0198233418.001.0001

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Product Differentiation

Product Differentiation

(p.46) 4 Product Differentiation
Strategic Interaction and Markets

Jean J. Gabszewicz

Oxford University Press

Abandons the assumption of a homogenous product to tackle the problem of competition among firms selling differentiated products. First, the role product differentiation is studied in the monopoly case: the problems of a monopolist selecting a ladder of substitute products, or selecting the quality of a particular product, are successively examined. Then, coming back to strategic competition, we analyse duopoly assuming that the rivals not only choose the price but also the product itself. The two cases of horizontal and vertical differentiation are considered. Also, the effects of entry are analysed in these two cases.

Keywords:   duopoly, firms, Hotelling, monopoly, product, product differentiation, quality

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