The option of joint purchase in vertically differentiated markets

Summary. Within the framework proposed by Mussa and Rosen (1978) for modelling quality differentiation, consumers are assumed to make mutually exclusive purchases. A unique pure strategy equilibrium exists in this case. In this note, we allow consumers to buy simultaneously different variants of the differentiated good. We call this the “joint purchase option”. The paper proposes a detailed analysis of price competition when this option is opened: first, we show that either uniqueness, or multiplicity, or absence of price equilibrium arise, depending on the utility derived from joint purchase relative to exclusive purchase. Second, we characterize these equilibria, whenever they exist. Received: July 25, 2001; revised version: October 21, 2002 RID="*" ID="*" The second author gratefully acknowledges the financial support from Interuniversity Attraction Pole Program- Belgian State- Federal Office for Scientific, Technical and Cultural Affairs under contract PAI 5/26. Correspondence to: X.Y. Wauthy     

Finiteness property in vertically differentiated markets: a note on locally increasing and decreasing returns

Summary. The results previously obtained on the finiteness property in vertically differentiated markets, with cost functions having increasing or decreasing returns, are extended to a much larger class of cost functions with local properties in a vicinity of the zero output. Moreover, existence results are provided to prove that the demonstrated properties have cases of application.Received: 11 June 2001, Revised: 18 February 2003, JEL Classification Numbers: L1, D43.Grateful thanks are due to Jacques-François Thisse, Jean-Jaskold Gabszewicz, an anonymous referee and especially to Jean-Marc Bonnisseau and Xavier Wauthy for very helpful suggestions and discussions. The revision took place partly when the author was visiting CERMSEM, Université de Paris-I, Paris then CORE, Louvain-La-Neuve, Belgium. Hospitality of both institutions is also acknowledged.     

Private and public financing of education and regional disparities in education inputs in contemporary China

Reforms to China's education sector over the last two decades have sought to diversify the sources of funding education. This paper examines the consequences of these reforms for Chinese families and regional disparities in access to education. To illustrate the implications of education reforms for Chinese families, we draw on a large survey of urban residents across 32 Chinese cities as well as a case study of fees charged by a single secondary school in Chengdu. We argue that while China has made progress in moving towards the United Nations objective of ‘Education for All’, decentralization of China's education funding has impeded access to schooling for many, particularly those living in financially disadvantaged locales, and placed an undue financial burden on many ordinary Chinese households.     

Product line pricing in a vertically differentiated oligopoly

Abstract This paper examines the joint pricing decision of products in a firm’s product line. When products are distinguished by a vertical characteristic, those with higher values of that characteristic will command higher prices. We investigate whether, holding the value of the characteristic constant, there is an additional price premium for products on the industry and/or the firm frontier, that is, for the products with the highest value of the characteristic in the market or in a firm’s product line. We also investigate the existence of price premia for lower‐ranked products and other product line pricing questions. Using personal computer price data, we show that prices decline with the distance from the industry and firm frontiers, even after holding absolute quality constant. We find evidence that consumer tastes for brands is stronger for the consumers of frontier products (and thus competition between firms weaker in the top end of the market). There is also evidence that a product’s price is higher if a firm offers products with the immediately faster and immediately slower computer chip (holding the total number of a firm’s offerings constant), possibly as an attempt to reduce cannibalization. Finally, a product’s price declines with the time it is offered by a firm, suggesting intertemporal price discrimination.     

On the efficiency of participation with vertically differentiated workers

In this journal Albrecht et al. (2010) assume that the planner problem is constrained by participation decisions. When this constraint is relaxed participation is too high whereas market tightness is too low. Subsidizing non-participants improves market efficiency and reduces unemployment.     

A model of adjuncts in higher education

We examine the phenomenon of the expanded use of non-tenure-track positions (“adjuncts”) and construct a supply-side Harris–Todaro model. Low adjunct wages are attributable to a “Hope Rent” from the gap between private opportunities and tenure-track utility.     

Trade and technology transfer in a vertically differentiated industry

This paper provides a model of trade and technology transfer in a vertically differentiated industry. We provide three key results. First, freer trade allows an increase in the size of the import competing sector, a counterintuitive proposition. Second, under reasonable conditions a foreign monopolist producing a relatively higher quality product will transfer technology to the local producer for producing a relatively lower quality product. Third, government can design subsidies to induce technology transfer and improve welfare.      

WOULD YOU LIKE TO ENTER FIRST WITH A LOW‐QUALITY GOOD?

Using a two‐period duopoly model with vertical differentiation, we show that there exists a unique subgame perfect equilibrium where the first entrant supplies a lower quality and gains higher profits than the second entrant. We also prove that this entry sequence is socially efficient.     

Low-quality leadership in a vertically differentiated duopoly with Cournot competition

We model a vertically differentiated duopoly with quantity-setting firms as an extended game in which firms noncooperatively choose the timing of moves at the quality stage, to show that at the subgame, perfect equilibrium sequential play obtains, with the low-quality firm taking the leader’s role.     

Price Competition and Consumer Externalities in a Vertically Differentiated Duopoly with Information Disparities

In this paper, we extend the model of vertical product differentiation to consider information disparities about quality differences and their effects on price competition. If uninformed consumers overestimate vertical differentiation, asymmetric information is a source of market power and informed consumers exert positive externalities on high quality product purchasers and negative externalities on low quality product purchasers. Such a result is consistent with the fact that information undermines brand. If uninformed consumers are skeptical, adverse selection issues arise and market demands may be perfectly inelastic to prices. With elastic demands equilibrium prices may be either distorted downwards or reflect real quality if the share of informed consumers is suffciently high. Therefore, with skeptical consumers firms may want either to signal quality or subsidize information provision.     

Endogenous timing and the choice of quality in a vertically differentiated duopoly

The endogenous choice of timing is discussed in a vertically differentiated duopoly where quality improvement requires a fixed convex cost. The timing decision concerns the quality stage. Using an extended game with observable delay, it is shown that only simultaneous equilibria can arise. This puts into question the ability of Stackelberg games to describe the entry process.     

Poverty,competition, democracy,and ownership: A general equilibrium model with vertical preferences

We consider a general equilibrium model where individuals are simultaneously workers, consumers, and shareholders, with two possible market structures: Monopoly and Duopoly, and two extreme ownership structures: egalitarian and concentrated. Considering three standard poverty indicators, the questions are, whether more competition generates more or less poverty for a given ownership structure; and whether a democratic choice between Monopoly and Duopoly leads to the alternative with less poverty. When the ownership is concentrated, we show that Duopoly generates less poverty than Monopoly and the majority votes for the alternative with less poverty. When the ownership is egalitarian, Duopoly may generate more or less poverty and democratic choice alleviates poverty regarding at least one poverty indicator and worsens poverty regarding at least another one, the three poverty indicators never converging. An empirical study on the effect of competition on poverty supports to some extent our theoretical findings.     

Trade liberalization in a differentiated duopoly reconsidered

Constructing a model of differentiated Cournot duopoly, we consider welfare effects of trade liberalization (i.e. reductions in transport costs). We examine both multilateral trade (i.e. the firms in both countries export bilaterally) and unilateral trade, under which foreign entry is possible but the home firm cannot export. Some new results on trade gains under differentiated oligopoly are proved and their implications are discussed.     

Monopolistically competitive equilibria with differentiated commodities

Summary. An existence theorem of monopolistically competitive equilibrium of the economy in which commodities are subject to differentiation will be proved. We start with the existence theorem of Negishi (1961) and extend it to the commodity space of measures on a compact metric space. In so doing, we have to handle the price normalization carefully. Received: December 2, 1996; revised version: May 6, 1999     

Convergence speed and preference externalities in a one-sector model with elastic labor supply

In a one-sector model with elastic labor supply where consumption and leisure externalities are incorporated, we examine the impact of preference externalities on convergence speed.     

本科生导师式教育模式的研究

实施本科生导师式教育模式是本科教育改革的一种探索。经过本课题组近三年的实践研究,获得了本科生导师式教育模式所带来的积极效果,具体如下：本科生导师式教育模式有利于学生个性的发展、潜能的发展、学业的进步,有利于新生适应大学生活,有利于培养学生的实践能力和创新能力,有利于提高学生的就业能力和创业能力,有利于对学生进行思想和心理的指导;根据学生家庭情况和不同阶段的特点以及适当聘请校外导师和学生导师,可充分发挥本科生导师式教育模式的作用。     

教育资源的去中心化——对支教的另一种解读

详尽解释了教育系统及其运行机制、教育系统发展历史以及教育系统模型,在此基础上提出支教是对教育资源的去中心化,是教育系统循环机制不完善情况下的特殊现象,随着教育系统的完善支教会退出历史舞台。     

A model of the learning process with local knowledge externalities illustrated with an integrated graphical framework

We present a unified graphical framework accounting for the nature and impact of spillover effects. The dynamics of the learning process with a specific spillover transfer mechanism can be illustrated by referring to this four-quadrant picture. In particular, a whole cycle of technological learning is explained with the help of such a graphical representation of the basic learning process in the presence of knowledge spillovers.

We hypothesize two different functional specifications of spillover exchanges among firms within a local innovation system. Each conceivable shape for the knowledge transfer relationship among firms expresses a possible mode and intensity of information processing arising from technology spillovers. A general proposition regarding the relative efficiency of the two alternative formal models with spillover effects is derived. The basic models with spillover effects are then extended in several relevant directions.     

Environmental policies in a differentiated oligopoly revisited

Constructing a model of polluting oligopoly with product differentiation, we consider how product differentiation, together with the presence and absence of free entry, affects optimal pollution tax/subsidy policies. The sign of the short- and long-run optimal pollution taxes are highly sensitive to the parameter measuring product differentiation as well as the presence of free entry. How they are affected by a change in product differentiation, which is not addressed in the existing literature, is also made clear.